Indian Insurance Sector Research Articles

The Insurance Laws (Amendment) Act, 2015 and life insurance policyholders

The insurance sector in India has long been an area that required a comprehensive legislative overhaul. This paper examines the recent amendments brought in this area through legislation. It is well known that insurance reform in India has followed a long and convoluted process spanning more than a decade, including a report by the Law Commission of India, a series of parliamentary standing and select committees and the use of ordinance powers. The paper explains the impact that the amendments have on nomination and assignment with respect to life insurance policies, the legal issues that arise in case of subsequent assignment, the nature of insurable interest under the new regime and the applicability of this framework to assignment of non-life personal insurance policies. This paper proposes a framework that would do away with current notions of nomination and assignment, instead adopting the twin concepts of beneficiary and transferee. In this manner, problems that arise from the dual nature of life insurance, as protection and property, would partly disappear once the legal regime is more closely aligned with the underlying economic rationale behind such instruments.

Changing Scenario of Insurance Sector in the Wake of Privatization and its Impact on Indian Economy

The Insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries.

A Paper on Growth of Insurance Sector in Indian Economy

The paper is streamlined to dissect the life Insurance sector in India and its growth in Competitive environment. India has seen economic growth with significant developments in length and breadth over a few decades. Economic liberalization in Insurance plays a significant role in growth and development of the sector. By allowing the private Insurance service providers has allowed India to tap its economic potentials. This has reflective effect in raising standard of living amidst Indian population because Life insurance policy is a social security instrument. Since 1999, IRDA the regulatory body acts as a controlling body for Insurance players in the risk management, by allowing the healthy competition amid the Insurers. Life Insurance market has a retrospective effect, led to improving investment climate by increase in the private players and promoting efficient blend of activities in the sector by adapting to the innovation in distribution of policies.

Penetration, Density and Elasticity aspects of Insurance Sector in India

The paper examines the growth of Insurance sector in India and compares the penetration and density levels of Indian Insurance sector with that of China and also estimates the income elasticity of demand for Insurance in India.

Comparative Service Quality Analysis of the Non-Life Insurance Sector in Twin City of Odisha - Using Servqual Model

Service firms in the developing country like other organizations now feel the importance of customer centric philosophies and turning to quality improvement to facilitate managing their businesses. The service quality has become a highly instrumental co-efficient in the aggressive competitive marketing. For success and survival in today's competitive world, presenting quality service is an importance for any enterprise. SERVQUAL as an effective approach to measure the quality of provided services and also analysis the gaps between customer expectations and perceptions of the service organization like non-life insurance sector in India. The present study has focused on finding of to assess the comparative service quality level of the Public sector and Private Sector Non-life Insurance Companies. The primary data has been collected from 200 respondents from Cuttack and Bhubaneswar city in Odisha. The study has found that there are seven major dimensions which impact on customer perception of service quality, like as tangibility, reliability, responsiveness, assurance, empathy, product availability and product convenience. Another aim of this paper is to point out how management of service improvement can become more logical and integrated with respect to the prioritized service quality dimensions and their affections on increasing or decreasing service quality gaps.

Impact Analysis of FDI on Insurance Sector in India

Parliament has passed Insurance Laws (Amendment) Bill, 2015. It was first passed in Lok Sabha on 4 March 2015 and later in Rajya Sabha on 12 March 2015, which will become an Act when the President signs it. The amendment bill aims to bring improvements and revisions in the existing laws relating to insurance business in India. The bill also seeks to remove archaic provisions in previous laws and incorporate modern day practices of insurance business that are emerging in a changing dynamic environment, which also includes private participation. It is expected that the foreign investment would bring about `20,000-`25,000 crore in short funds. The amendment bill hikes Foreign Direct Investment (FDI) cap in the insurance sector to 49 percent from present 26 percent. The foreign investment in insurance would be routed under foreign direct investment,foreign portfolio investment,foreign venture capital investment,depository receipts,and non resident indians. Insurance companies are permitted to raise capital through instruments other than equity shares. Instruments would be specified through separate regulations by the Insurance Regulatory and Development Authority of India (IRDA). However, the voting rights of shareholders are restricted only to equity shares. Sale of shares over 1% of the total equity share capital and purchase of shares resulting in total equity share capital of more than 5%, requires the prior approval of the IRDA. It also adds provision for the establishment of Life Insurance Council and the General Insurance Council. These councils will act as self-regulating bodies for the insurance sector. The bill also grants permission to PSU general insurers to raise funds from the capital market and increases the penalty to deter multilevel marketing of insurance products. There is a strong relationship between foreign investment and economic growth. Larger inflows of foreign investments are needed for the country to achieve a sustainable high trajectory of economic growth. A major role played by the insurance sector is to mobilize national savings and channelize them into investments in different sectors of the economy. FDI in insurance would increase the penetration of insurance in India; FDI can meet India’s long term capital requirements to fund the building of infrastructures. The present paper focuses on the overview of the Indian insurance sector along with the opportunities due to expansion of FDI in insurance in India and the major challenges that it faces.

Financial and non-financial drivers of insurance sector in an emerging economy

This paper identifies key factors that drive and impede the growth of the insurance sector in India. Emerging economies have huge growth potential. India is an economy that attracts opportunities for growth. The growth pattern in the last ten years is discussed highlighting a huge influx of foreign funds to the country, and benefits and challenges to stakeholders, and extent of oversights on insurance firms. Using the finance data from all the 23 insurance firms in India for the period from 2005 to 2014, we find that the growth in insurance sectors is related to first year and renewal premiums, commission and operating ratios, individual and corporate agents, offices, capital and assets, and profits, and is not related to new products, investment income and claims ratio. The sector's contribution to economic growth is also shown. The findings have ramifications for the sector's providers, regulators and investors.

The influence of Education, Occupation and Income on Perceived Customer Value

The aim of this paper is to assess empirically perceptual gap among the customers having different educational qualification, occupation and income regarding customer value in Indian insurance sector. It is a fact that insurance sector has been growing tremendously despite a lot of competition in the marketplace. The study is based upon the primary data obtained from customers of four life insurance companies belonging to various districts of J&K through quota sampling. A questionnaire was framed containing items of demographics and statements measuring customer value based upon seven point Likert scale. The findings indicate that the demographic variables viz., qualification, occupation and monthly income, there is no significant difference regarding perceived customer value among the life insurance players.

Challenges to American Insurance Companies in India

In India, insurance is a national matter in which life insurance and general insurance are yet booming sectors with vast opportunities for different global companies, Life insurance premiums account for 2.5% and general insurance premiums account for 0.65% of India‘s GDP. The Indian insurance sector has gone through several phases and changes, especially after 1999/2000 when the Government of India opened up the insurance sector for private companies to solicit insurance, allowing FDI up to 26%. Since then, the insurance sector in India is considered as a flourishing market amongst global insurance companies. In March 2013, the FDI limit has been raised from 26% to 49%. This long pending step will definitely boost the confidence of global insurers and investors. However, the largest life insurance and general insurance companies in India are still owned by the government. The foreign insurance players are, however, quite capable of grabbing the vast opportunities and successfully meet challenges, if any.

Health Insurance: An Overview of Indian Perspective

In this paper the authors have tried to give an overview of health insurance sector in India. The authors have tried to compare the health Insurance sector of India from different countries. The author have also thrown light on the legal provision governing health insurance sector in India. Finally, the paper suggests some measure to improve the health insurance sector.

Factors Influencing Customer’s Choice For Insurance Companies- A Study Of Ajmer City

Insurance sector in India is growing at a very fast pace. With the entry of more and more private sector insurance, the competition within the industry is becoming very intense. Competition in the country among the insurance companies is strong as there have been new entrants into the market. Thus customer satisfaction is a crucial issue for the insurance company management to retain and attract its potential customers. Insurance companies do not know the need of their customers and thus they lose their potential customers. Therefore, it is important to identify and evaluate factors that influence customer's choice for a insurance companies. This study is an attempt to explore the factors that have a high influence on customer's choice in Ajmer insurance industry, to find out which factors have more influence on customers and rank these factors according to the ratings given by the respondents for each factor. Demographic variables play a very important role in understanding customer's perception. Thus, the impact of demographic profiles was also assessed. A survey of 120 respondents were taken and analyzed to understand the factors that influence the insurance companies' selection decisions. The study relied on 29 factors using mean and factor analysis and these factors were extracted from the literature and personal interview. The findings revealed that according to the ranks given the most important factors that influence customers for selecting a insurance companies are computerization and online transactions, connectivity with bank , speed and efficiency in transactions, clear communication and the least important factors are influential marketing campaign, free gifts for customers, peer group impression etc. . In addition, factor analysis was used over 29 factors and the result showed that there were 9 key factors, which were determined by clubbing the similar variables, which majorly consider being most influencing factors for customer's choice of a insurance companies.

Service Quality Assessment: A Study of Consumer Satisfaction in Indian Insurance Sector

The service quality has become a highly instrumental co-efficient in the aggressive competitive marketing. For success and survival in today's competitive environment, delivering quality service is of paramount importance for any economic enterprise. The underlying model of SERVQUAL (Parsuraman et al., 1988) with five dimensions is used to evaluate the impact of service quality on customer satisfaction. The present study aims to measure customers' perception and expectation towards life insurance service quality. Data has been collected from 500 customers from the five cities of Uttar Pradesh (progressive State of India). Besides, the study also investigates the relationship between customer expectation and perception of service quality dimensions and customers overall satisfaction of life insurance service quality.

Impact of income on the insurance potential a case study of rural sector of Jammu and Kashmir state

The Indian Insurance industry is flourishing with several national and international players competing and growing at rapid rates. The globalisation has allowed the Indian insurance sector to flourish as there is huge market potential for insurance in India and this potential will definitely increase further in future. The survey was conducted from the state of Jammu and Kashmir using primary and secondary sources of data. This study has explored and assessed insurance potential in rural areas of Jammu and Kashmir State by analysing relationship between disposable income and Insurance potential. Looking at the source of information for households, it was found that television is the primary source for both insured and uninsured households. Other sources of information are friends, relatives and neighbours, news papers, radios, and transistors. Keywords: Households, Insurance, Information, Potential, Regulation.

IMPACT OF INCOME ON THE INSURANCE POTENTIAL- A CASE STUDY OF RURAL SECTOR OF JAMMU AND KASHMIR STATE

The Indian Insurance industry is flourishing with several national and international players competing and growing at rapid rates. The globalisation has allowed the Indian insurance sector to flourish as there is huge market potential for insurance in India and this potential will definitely increase further in future. The survey was conducted from the state of Jammu and Kashmir using primary and secondary sources of data. This study has explored and assessed insurance potential in rural areas of Jammu and Kashmir State by analysing relationship between disposable income and Insurance potential. Looking at the source of information for households, it was found that television is the primary source for both insured and uninsured households. Other sources of information are friends, relatives and neighbours, news papers, radios, and transistors.

A Study of the Changes in Human Resource Management Practices in LIC Due to the Impact of Private Insurance Players

The Government made a paradigm shift in the economic policy by adopting the process of liberalization, privatization, and globalization at the end of the previous decade. IRDA was set up as regulatory body and the private sector was allowed entry both in general and life insurance sector in India. Due to this impact, the private players came up with new and innovative marketing strategies. Due to these efforts of the private players, the benefits which LIC was enjoying due to its monopoly in the market were taken away, and it had to face tough competition to retain its market share. To fight this competition, LIC had to leave its traditional track and bring changes in its working. It has been widely accepted that the human resources of an organization are the key towards success. The present research paper throws light on the changes which LIC brought in its HRM policies due to the impact of the private insurance players. The changes brought by LIC in the agents' recruitment, training, performance management system, and learning and development activities have been discussed in the present paper.

A Study of the Changes in Human Resource Management Practices in LIC Due to the Impact of Private Insurance Players

The Government made a paradigm shift in the economic policy by adopting the process of liberalization, privatization, and globalization at the end of the previous decade. IRDA was set up as regulatory body and the private sector was allowed entry both in general and life insurance sector in India. Due to this impact, the private players came up with new and innovative marketing strategies. Due to these efforts of the private players, the benefits which LIC was enjoying due to its monopoly in the market were taken away, and it had to face tough competition to retain its market share. To fight this competition, LIC had to leave its traditional track and bring changes in its working. It has been widely accepted that the human resources of an organization are the key towards success. The present research paper throws light on the changes which LIC brought in its HRM policies due to the impact of the private insurance players. The changes brought by LIC in the agents' recruitment, training, performance management system, and learning and development activities have been discussed in the present paper.

Emerging Trends in Distribution in the Life Insurance Sector in India: A Study of a few Leading Players

The life insurance industry in India had its birth in the early part of the nineteenth century. For better management of the insurance business, several Acts have been passed from time to time. Two noteworthy events in the history of life insurance are (i) the formation of the Life Insurance Corporation of India in 1956, which served as a monopoly till the year 2000 followed by (ii) the opening up of the insurance sector to the private players in 1999, who were given the permission to operate either single-handedly or as a joint venture with any other private player(s) and/or foreign partner. This drastic regulatory change brought an end to the monopoly status of LIC, and also encouraged the private players to enter into the insurance space. To keep pace with the fast-changing industry environment, one of the functions that is gaining strategic importance is the coming up of newer channels of distribution, which would spread the business to newer markets and serve the customers cost-effectively, steadily, and speedily. This exploratory research (which was carried out in the time period from May-July 2012) discusses the various distribution channels (that emerged in the deregulated period and changed the overall industry trend) operating over a period from 2005-06 to 2009-10. The researcher considered seven dominating private players in the life insurance industry to understand the recent patterns in distribution. The analysis clearly shows a move-away from the traditional channels by the private sector.

Impact of Privatization on Productivity: A Non-Parametric Analysis of Indian Insurance Sector

The insurance sector was opened up for private participation on the ground that the interests of the consumers would be better served if there is competition among the insurers, which will ultimately increase productivity of the sector as a whole. The main objective of this article is to analyze the productivity changes of Indian life and non-life insurance business with the application of non-parametric Malmquist indices. Therefore, this study uses ‘expenses related to labour’ ( x1), ‘expenses related to business service and materials’ ( x2) and ‘total investment’ ( x3) as major three inputs; and following the ‘intermediation approach’ and the ‘value-added approach’, this study uses ‘premiums earned’ ( y1) as the output for risk bearing/risk pooling service following the value-added approach and ‘income from investment’ ( y2) as the intermediation output. From the productivity analysis we found that, during the study period (2005–2006 to 2009–2010) total factor productivity decreased in life insurance business but it increased in case of non-life insurance business with different reason behind the change. We can also conclude in overall factor productivity analysis excluding public sector insurers; though the public sector insurers are significantly older in the market but it has an unfavourable impact on the insurance market in terms of factor productivity and technological progress.

Growth of Insurance Sector in India – The New Horizons

Indian insurance is a flourishing industry, with several national and international players competing and growing at rapid rates. The easing of policy regulations, the Indian insurance sector been allowed to flourish, and as Indians become more familiar with different insurance products, this growth can only increase, with the period from 2012 - 2018 projected to be the 'Golden Age' for the Indian insurance industry. Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost two centuries. There is a probability of a spurt in employment opportunities. Many of the universities and management institutes have already started or are contemplating new courses in insurance. Life insurance has today become a mainstay of any market economy since it offers plenty of scope for garnering large sums of money for long periods of time. A well-regulated life insurance industry which moves with the times by offering its customers tailor-made products to satisfy their financial needs is, therefore, essential if we desire to progress towards a worry-free future.

CRM index: an effective weapon for relationship enhancement

A reliable and valid CRM (customer relationship management) index is developed in this paper. A standard methodology for scale development was followed; further to this the CRM index is developed through a case based method along with the customer and service provider weights. The findings clearly depict CRM as a multidimensional construct comprising factors namely claim payment security, knowledge about products, personalisation, transparency in product selling and service quality. A fair amount of literature on the Indian insurance sector dealt with identifying factors explaining the constructs of quality, value and satisfaction. But there is a paucity of research pertaining to industry-specific CRM index specifically catering to the Indian insurance sector. The proposed index will help in identifying issues that contribute to CRM and thereby formulating strategies accordingly, resulting in effective and efficient practices. The scores from organisational as well as customer’s perspectives can be calculated so as to get newer insights.