Changing Face of Insurance Sector in India

Posted on Posted in Assurance Autos

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Ever since the advent of Comprehensive Act of Insurance in 1938, the country has witnessed many changes over the past decades in the insurance sector. Initially, the insurance sector remained confined with urban sector only. It was after the 1970s that insurance did become a matter of concern for rural sector as well. After 1999, on the constitution of IRDAI, there has been a changing face of the insurance sector in India by large.

Launch of New Products

It was endowment policies and money back policies which were prevalent at the beginning. But with the changing face of the insurance sector in India, there has been a rapid change in the products too. Apart from the usual plans, there has been inculcation of child plans, term plans, pension plans, ULIP (investment plans), crop insurance, machinery insurance, fire insurance, etc.

New Digital Era

Over the years, digitalization is seen everywhere. It has been the case with insurance sector too. Purchase of plans, servicing, renewals, payments of premiums online, handling claims online, customer feedback and much more is being done in the insurance sector.

Advent of Digital Payment For Insurance

With the support of our Prime Minister, Shri Narendra Modi the demonetization has been a boon to the insurance sector for insurers as well as the policyholders. There has been a discount of 8 to 10 percent on services related to general and life insurances. Be it buying a new policy or paying premium online through public sector undertaking websites, the result is phenomenal. The insurers get their premiums on time and policyholders get the discounts.

This, in turn, has benefited the entire economy system of India.  There has been an accountability of money, generation of taxes and overall improvement in the mainstream economy of the country. In short, when there is money with the Government, better plans and better schemes can be crafted for citizens of India.

Online Insurance Sector

Today online purchases and payments are not confined to mutual funds and shares but it has started in the insurance sectors too. Every insurance company has a website to showcase their products on. There are web aggregators who bring in a chart of comparison from various insurance companies and you could compare your best deals too.

The best thing is it is no more an urban affair or a rural defied state of things. Online insurance has taken by storm through-out the country. Even remotest of remote places buy, renew, make payments of premium and even avail post-purchases services of insurance nature online.

The advent of penetration of digital platform sowed the seeds somewhere in 2005, but with demonetization coming in; it has made the concept of online even more powerful.

Ever since 2010-11, insurance companies have started emphasizing on the online mode of operations too.

Impact On Non-Metro Cities And Towns

A recent survey showed that online purchase of insurance policies had shown a rapid increase from a mere 2% to 200% in just a span of two years.

This means, the online sales has contributed marginally well and the turnover is going massive with insurance sector in India.

A large section of the population of India consists of youth. With proper skills and technology advancement, reaching onto a mobile app and getting insurance related things done is much easy.

Synopsis

With the onset of online insurance, there has been a huge change.  The present-day scenario states that low-mid income segment people are a major contribution to the online insurance market whereas those of higher earnings contribute to a mere 5% of online customers. Overall this changing face of the insurance sector in India is only climbing the ladder of success.