Page 19 - Life Insurance Today March 2016

has been one of the most significant developments in the
global economy. Overall, the regulatory environment is
favourable and takes care that players maintain prudent
underwriting standards, and reserve valuation and
investment practices. The primary objective for the current
regulations is to promote stability and fair play in the
market place.
The promise of India's insurance market is compelling, with
all the elements needed for handsome growth. The
country's life insurance market is a good example of the
potential a young, increasingly prosperous population
offers insurance companies that realize this opportunity
and make plans to benefit from it. The Indian insurance
market has great growth potential, with life premiums
predicted to reach US$230 billion by 2025, driven in part
by a culture of saving.
A favourable regulatory environment, increasing consumer
awareness about the benefits of insurance and higher
levels of infrastructure development are expected to drive
growth in the Indian non-life insurance sector during the
forecast period from 2014 to 2018. The Indian non-life
insurance segment is concentrated, with the top 10
companies accounting for 77.5% of the gross written
premium in 2014. The leading four insurers operating in
the non-life segment are government-owned, and
accounted for 49.4% of the segment's gross written
premium in 2014.
The remaining six are insurance joint ventures with foreign
companies. They account for 28.2% of the segment's gross
written premium. The potential for greater foreign
involvement in the Indian non-life insurance industry
opens up the possibility of greater competition and
application of marketing techniques to build brand
awareness and therefore increase market penetration.
The insurance sector has been waiting for much-needed
economic reforms. For instance, the sector is still largely
closed to higher levels of foreign direct investment that has
been eagerly awaited by the promoters of insurance
companies. Despite these challenges, the insurance
industry is trying its best to adjust to these new market
dynamics of increasing wealth, changing demographics and
consumer preferences.
"The person, be it gentleman or lady, who has not pleasure in a good novel, must be intolerably stupid."
Life Insurance Today March 2016
Wide range of technical assistance:
The growth in insurance industry has been spurred by
product innovation, vibrant distribution channels, coupled
with targeted publicity and promotional campaigns by the
insurers. Innovation has come not only in the form of
benefits attached to the products, but also in the delivery
mechanism through various marketing tie-ups. All these
efforts have brought insurance closer to the customer as
well as made it more relevant.
Due to the growing demand for insurance, more and more
insurance companies are now emerging in the Indian
insurance sector. With the opening up of the economy,
several international leaders in the insurance sector are
trying to venture into the India insurance industry. US
Agency for International Development Deloitte provided
a wide-range of technical assistance to the IRDA while
supporting institution-building efforts of other
stakeholders working within the insurance market in India.
Specific activities included:
 Designed and implemented trainings for the regulator
in most aspects of the regulatory cycle. Special focus
was placed on encouraging the practical application of
principles of health insurance, health economics and
managed health care as well as in actuarial
methodologies used in the scientific pricing and
reserving of health insurance products
 Assisted the design and installation of an IT-based
"early warning system" to monitor insurer solvency
and the association of actuaries to adopt a more broad
actuarial education curricula and apply modern
actuarial methodologies
 Introduced supervisory tools and examination
manuals for on-site financial condition examination
and market conduct inspection of insurance
companies and provided assistance in capacity-
building activities for the associations of life insurers
and general insurers, particularly in areas relating to
self-regulation
 Organized two internship programs in cooperation
with the US National Association of Insurance
Commissioners (NAIC) to enhance IRDA staff's
knowledge and skills in insurance supervision and
take advantage of on-the-job learning in several state
insurance departments in the United States;
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