Insurance — growing market in India

New and exciting areas of insurance are opening up in the Indian market, as the economy is growing at a healthy rate, providing the youth with great career opportunities, according to Ms Chitra R. Sekhar, Regional Manager of the United India Insurance Company.

She was addressing students of AQJ College of Management here on Monday at a guest lecture on general insurance organised by the Business Line Club and sponsored by Tata Photon.

She said the size of the Indian market was very attractive to many companies, Indian or foreign, and also the fact that there was a vast uninsured or underinsured, area in the economy.

“There is little awareness about insurance, either life insurance or general insurance, and therefore insurance penetration is very low in India, compared with many other countries, even developing ones. This vast unexploited market draws many companies,” she said.

She explained to the students the history of insurance companies in independent India, of the many private companies both in life and general insurance sectors in the fifties, the nationalisation of the industry and the formation of LIC and the four public sector general insurance companies, and the changes after liberalisation of the Indian economy and the re-entry of private companies during the past decade or so. “There is an increasing demand for hiking the ceiling of foreign equity from 26 per cent to 49 per cent in the insurance sector and greater liberalisation. The role of private sector is bound to grow in the sector,” she remarked.

Referring to her area of specialisation, Ms Chitra said general insurance had grown by leaps and bounds in the country during the past decade from Rs 10,000 crore in 1999 to Rs 40,000 crore now. The target was to cross the Rs 1 lakh crore mark by 2020, “but I am sure it would be achieved much earlier, probably by 2017 or so.”

She said the general insurance sector was growing by a healthy 13 per cent annum, but the premium density was only $4.4 dollars, very low in comparison with many other countries. Still, she said, the outlook was very promising for the young in the sector, if they improve their skills and reorient their attitudes.

She said that in a heterogenous and plural society such as India it would be impossible to meet expectations of all sections, and therefore there would also be problems plaguing every sector including insurance.

“It becomes necessary in future to offer comprehensive coverage, especially in view of increasing cyber crimes, and also liability insurance. These areas are nascent in the Indian market but I am sure they will come to play a greater role and therefore the future in the insurance sector is both challenging and exciting for the next generation,” she concluded.

Mr T.V Suresh, Regional General Manager of the Hindu, welcomed the gathering. Mr. B. Anjaneyulu, Manager of United Insurance, and Dr. R. Vijaya, Director of the institute, also participated in the event.

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