Insurance Sector Reforms Research Articles

Analyzing the Impact of Liability Insurance on the Financial Performance of Insurance Companies in Nigeria

The insurance sector reforms in Nigeria sought to create a strong, diverse, and trustworthy industry that protects insured premiums, actively contributes to the country's economic progress, and participates in worldwide financial systems. Despite this development, insurance business operations and survival have not been impressive, and performance remains alarmingly poor. Therefore, this study investigates the effect of workers' compensation written premiums and workers' compensation claims paid of the chosen insurance companies' return on assets (ROA) in Nigeria. This study is a longitudinal research design. Secondary data obtained from the financial statement of five selected insurance firms in Nigeria over the year 2013 to 2022 were analysed with correlation analysis and panel regression estimation technique. The result of the study, based on Hausman verification, showed that workers' compensation written premium has a significant positive effect on RoA and that workers' compensation claims paid has a significant negative effect on RoA in Nigeria. Consequently, this investigation established that liability insurance is an important factor that may have been disturbing the performance of insurance firms in Nigeria, and must be treated with utmost care in the process of enhancing performance. Therefore, this study recommended among others that insurance firms need to increase the rate of client application towards workers' compensation insurance to realize increased levels of premium and income for performance-enhancing operations.

Macro-Economic Determinants of Life Insurance Business – Empirical Evidence during 2000-01 to 2015-16

There is a strong link between an institutional framework of insurance sector and sustainable economic growth. Insurance business has a positive impact on economic development and vice versa. As a developed insurance market stimulates economic growth of a country, the level of its economic growth affects insurance business development in return. In India, regulatory changes commenced since mid-nineties for opening up of insurance markets to private and foreign insurers. After more than one and half decade execution of insurance sector reforms, Indian life insurance business have been witnessed the better growth. In this juncture, the present study focuses on an examination of the role of a macroeconomic environment in the development of life insurance industry in India by using time series data with regression analysis. The study finds that the savings to GDP ratio, banking sector development, expenditure on social security to GDP, gross enrolment ratio and life expectancy are most significant and positive factors in driving the life insurance business during the study period.

Life Insurance Sector Development and Economic Growth of India in the Changing Policy Regime

The changing economic scenario of the Indian economy posed new challenges to almost all the sectors of the economy, and the insurance sector is no exception. The introduction of insurance sector reforms not only eliminated the monopoly of life insurance sector, but opened up the insurance windows to the private players which increased the competition in many folds, especially since 2000. The reforms brought an overall increase in insurance penetration as well as insurance density in the country. As a result, the insurance industry is today more efficient and exerts considerable positive impacts on the growth of the Indian economy. The insurance sector contributes to a rise in labour productivity through efficient investments, and also generates productive employment opportunities. In this context, this paper examines dynamics of the relationship between the development of life insurance sector and the real economic growth in the changing policy regime in India, and provides the evidence of the positive and significant relationship between them. Therefore, it is suggested to prioritize the focus on the further development of the sector may be through the implementation of prudent policies to increase rural penetration of life insurance in India. Also, the inclusive growth strategy in the country can be effectively mobilized to enhance the development of the life insurance sector.

English

FDI plays a key role in the globalisation process in terms of financing, transferring of skills, knowledge and technology between countries. The economic reforms initiated in India in the early 90s paved the way for the growth and opening up of the financial sector. Insurance and banking are the main components of finance sector. The reforms in insurance sector started in the year 2000 with the implementation of recommendations made by the Malhotra committee. Indian insurance industry was opened up for private players in the year 2000 with the enactment of IRDA Act. However to meet the capital requirement of private insurance companies the Government approved to enhance the FDI cap from 26% to 49%. In the last fourteen years of period the insurance industry has moved forward on multiple fronts. At the same time the industry is faced with many challenges. On this backdrop an attempt is made to study the significance of FDI and the challenges and prospects of insurance sector during the post reforms period. It is find that liberalisation in insurance sector has brought many positive changes in the industry and at the same time it demands to strengthen CSR and Governance principles for sustainable growth in the industry

Privatisation and Growth of Insurance Industry in India

India initiated its insurance sector reforms in 2000 as an inevitable part of the on-going economic reforms in the country. This long awaited reform was expected to boost the sector. The Insurance reform was marked with the establishment of IRDA, participation of private companies and permission of FDI, and soon it emerged as one of the most vibrant segment of Indian financial sector. India’s insurance sector witnessed many changes and experienced high growth after the privatisation. As the privatised insurance industry has completed more than a decade now and the sector is evolving with the progression of further reform, a close scrutiny of the sector is needed. This paper tries to narrate the story of the development and growth of the insurance sector during the first decade after the privatisation of the sector.

The Economic Study of Life Insurance Policy, Pattern for Small Number of Asian Economics and India

This paper provides comprehensive surveys of the achievements in the investment are of life insurance policies after insurance sector reforms. During the post-1990 period, services sector in most of the Asian economies witnessed growth fuelled by substantial changes in the financial sector of these economies. The insurance industry, in most of the Asian economies, ASEAN and SAARC economies in particular, was publicly owned and remained isolated from participation of either domestic private insurers or foreign insurers or participation of both. But, regulatory reforms and policy changes in the ASEAN economies during the post-financial crisis period and the process of economic liberalization in some of the SAARC countries and China led to phenomenal changes in the growth pattern of the insurance industry in these economies. This study is divided into two parts: the first part is focused on four SAARC countries, two countries from Greater China Region and six ASEAN countries for the 11year period (1994-2004) to understand economic and other socio-political variables, which may play a significant role in explaining the life insurance consumption pattern in these economies. Secondly, an independent exercise is undertaken to re-assess whether or not the variables best explaining life insurance consumption pattern for twelve selected Asian economies in the panel are significant for India for the period 1965 to 2004.

Life Insurance in India: the Relationship between Reforms and Growth in Business

Reforms in the Indian life insurance sector began in 1999 and since then the growth of the life business has been impressive despite some restrictions. Whether the reforms in this sector have helped the industry to grow or not is an empirical matter. We, therefore, studied the relationship between life insurance sector reforms in India and the growth of life business in the post-reform period. At the empirical level, we first construct an index to measure the reforms and then used the VAR–VECM model to find out the long-run relationship. The Granger causality test suggests that life insurance sector reforms improved the overall development of life insurance development in recent years in India.

Do Insurance Sector Growth and Reforms Affect Economic Development? Empirical Evidence from India

A well-developed insurance sector is necessary for the economic development of an emerging economy like India, as it provides long-term funds for physical and social infrastructure, while simultaneously strengthening risk-taking abilities. The investment requirements for India in the coming years are well-known and the rapid growth of the insurance sector in the post-liberalisation period is seen as a good sign as it can, to some extent, facilitate investment in infrastructure development to help sustain the economic growth of the country. Against this backdrop, this paper raises an important question: what has been the contribution of insurance sector growth to economic development in India? The paper further examines the economic growth effects of insurance sector reforms and the rate of growth of insurance reforms. The claims brought forward by this study are mixed. The contribution of the insurance sector to economic development is positive and exhibits a long-run equilibrium relationship. We find that reforms exert no strong relationship, but the rate of growth of reforms has a positive influence on economic development. The study therefore suggests that in order to make the insurance sector a more important component of the financial intermediation process, complete deregulation and an increase in the pace of reforms are the need of the hour.

Insurance Sector Reforms in India: Achievements and Challenges

Insurance Sector Reforms in India: Achievements and Challenges

Korean Experiences in Life Insurance Sector Reforms after the Financial Crisis

In July 1997, what began as a seemingly isolated currency devaluation of the Thai baht proved to have a virulent contagious effect, which led to speculative attacks in Indonesia and Taiwan as well as on the Hong Kong dollar. The contagion quickly spread to Korea where, amid massive capital outflows, a sharp depreciation in the local currency and severe distress in both the financial and corporate sectors, the nation was forced to turn to the IMF in December 1997 for a then record US$58 billion economic rescue package. After the rescue from the IMF, Korea suffered painful experiences with a rapid drop of per capita income from over US$10,000 to US$6,000 and a sharp increase in the unemployment rate from 2 per cent to 8.4 per cent, with 1.8 million unemployed. During