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inflow of around Rs 20,000 crore. Furthermore, FDI hike through banks has come down. With awareness about
in insurance is de jure increase in FDI limits for pension insurance on the rise, potential customers are looking for
sector also. The move could also presage the emergence banks or insurers to assess their requirements and then
of a new market for reinsurance in India with the suggest products. As more people join the bandwagon and
legislation providing for the entry of global companies such ask for need analysis, there can't be mis-selling.
as Berkshire Hathway, Munich Re, Lloyds of London and
Swiss Re. They can operate in India through branches Life Insurers - 5 Years
similar to multinational banks, providing for flexibility.

The passage of the legislation also alleviates concerns
about policies getting stuck owing to resistance in the
Upper House. It will be seen as a signal that the
government is able to move amendments and Parliament
is functioning. The regulation bringing in additional capital
will stimulate growth of Indian life insurance. Also,
attracting foreign insurers to come to the market will bring
in new ideas and experience.

Disruptive market growth: Non-Life Insurers - 5 Years

The industry went through a painful time between 2010
and 2013. Now, it has come out of many challenges. The
biggest challenge the industry faces today is to build a
trustworthy relationship with its customers. There is a
huge gap to be covered on this front. The other possible
challenge for the industry would come if the economy
does not pick up and income growth of individuals is
impacted. Then product sale will not happen.

The industry has been growing by 20-25% and this growth
should continue over the next 2-3 years. Insurance
awareness has increased due to regulatory help and the
launch of Pradhan Mantri Jeevan Jyoti Bima Yojana. The
scheme has brought 12 crore customers this year. The
industry needs more of such no-frill traditional products
that can be sold easily and do not require much
explanation. Such products will also help penetration in
smaller markets.

The regulator has put many checks and balances in place
to curb mis-selling like need assessment before selling
insurance products. Banks are in the process of
implementing these checks and balances. Also, banks are
regulated entities and thus safe when it comes to selling
products to customers.

Other distribution channels are not regulated. Mis-selling

"There are only two ways to live your life. One is as though nothing is a miracle. The other is as though everything is a miracle."

Life Insurance Today March 2016 21