INSURANCE SECTOR IN INDIA
Principles of Insurance
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Types of Insurance
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Major players in
insurance Sector in India
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Q1. What is
Insurance:
Insurance is a contract between the
insurer and the insured wherein against receipt of certain amount,
called premium, the insurer agrees to make good any
financial loss that may be suffered by the insured, due to the
operation of an insured peril on the subject matter of insurance.
Q.2 : Why People Opt
for Insurance?
The Life is full of
uncertainties.. People opt for insurance
purely for the reasons of uncertainties in life. Insurance gives the
insured a kind of peace of mind as he is assured to making up the loss
in the event of such uncertainities in life happen.
Q.3 How does
Insurance work?
Insurance is a
technique wherein a number of people, who are exposed to similar risk,
participate in the scheme and contribute in the shape of periodic
premiums. Such premiums are received by the insurer who is able to pay
out of the premiums received by him, for the losses of some of those who have
participated in the scheme.
Thus it is wonderful
technique of spreading and transfer or risks.
Q.4 : What kind of Insurance Are
Available in India :
Insurance business is
divided into four classes , namely :
1) Life Insurance.
Popular Products in Life insurance are Endowment Assurance
(Participating), and Money Back (Participating). More than 80% of the life
insurance business is from these products
2) Fire Insurance 3)
Marine Insurance and 4) Miscellaneous Insurance. Fire and Miscellaneous
insurance businesses are predominant. Motor Vehicle insurance is compulsory.
Life Insurers
transact life insurance business; General Insurers transact the rest
i.e. Fire Insurance, Marine Insurance and Miscellaneous Insurance.
Q. 5 : What are the
Primary Legislations for Insurance in India:
In India Insurance is a
federal subject. The primary legislations that deals with
insurance business in India are:
Insurance Act, 1938,
and Insurance Regulatory & Development Authority Act, 1999.
Q. 6: What are
Consumer Protections Available in India :
Insurance Industry has
Ombudsmen in 12 cities. Each Ombudsman is empowered to redress customer
grievances in respect of insurance contracts on personal lines where the
insured amount is less than Rs. 20 lakhs, in accordance with the Ombudsman
Scheme. Addresses can be obtained from the offices of LIC and other insurers.
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Different Types of Insurances
Principles of Insurance
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Types of Insurance
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Major players in
insurance Sector in India
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(A) LIFE INSURANCE :
- Term Life Insurance
- Permanent Life Insurance
(B) GENERAL INSURANCE
- Fire Insurance
- Marine Insurance
- Accident Insurance
(A)Life Insurance
Life Insurance is a contract providing for payment of a sum of money to the person assured or, following him to the
person entitled to receive the same, on the happening of a certain event. It is a good method to
protect your family financially, in case of death, by providing funds for the loss of income.
A1. TERM LIFE INSURANCE : Under a Term Life contract, the insurance company pays a specific lump sum to the designated beneficiary in case of the death of the insured. These policies
are usually for 5, 10, 15, 20 or 30 years.
Term life insurance are the most popular in advance countries but
were not so popular in India. However, after the entry of the
private operators and aggressive marketing by few players this kind of policies
are becoming popular. The premium on such type of policies is
comparatively quite low when compared with other types of life insurance
policies, mainly due to the fact that these policies do not carry
cash value.
PLUS OF TERM LIFE INSURANCE
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MINUSES OF TERM LIFE INSURANCE
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- The premium payable
on these policies is low as they do not carry any cash
value.
- One can afford for
quite high value insurance policies
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- If one survives the
period of the policy, he / she does not get any money at the end of the
policy.
The premium on such
policies keeps on increasing with age mainly because the risk of death of
older people is more. Over the page of 60, these policies become difficult to afford.
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A2.
PERMANENT LIFE INSURANCE :
In a
Permanent Life contract, a portion of the money paid as premiums is
invested in a fund that earns interest on a tax-deferred basis. Thus,
over a period of time, this policy will accumulate certain "cash
value" which you will be able to get back either during the period of
the policy or at the end of the policy.
Your need for life
insurance can change over a lifetime. At any age, you should consider your
individual circumstances and the standard of living you wish to maintain for
your dependents. In most cases, you need life insurance only if someone
depends on you for support. Your life insurance premium is based on the type
of insurance you buy, the amount you buy and your chance of death while the
policy is in effect. This type of policy not only provides protection
for your dependents by paying a death benefit to your designated beneficiary
upon your death, but it also allows you to use some part of the money
while you are alive or at the end of the policy. Some examples of such policies are :- Whole Life,
Universal Life and Variable-Universal Life.
ENDOWMENT POLICIES
These policies provide
for period payment of premiums and a lump sum amount either in the event of
death of the insured or on the date of expiry of the policy, whichever occurs
earlier.
MONEY BACK POLICIES
These policies provide
for periodic payments of partial survival benefits during the term of the
policy itself. A unique feature associated with this type of
policies is that in the event of death of the insured during the policy term,
the designated beneficiary will get the full sum assured without deducting
any of the survival benefit amounts, which have already been paid as
money-back components. Moreover, the bonus on such policies is also
calculated on the full sum assured.
ANNUITY / PENSION
POLICIES / FUNDS
This policies / funds
require the insured to pay the premium as a single lump sum or through
installments paid over a certain number of years. The
insured in return will receive back a specific sum periodically from a
specified date onwards (the returns can can be monthly, half yearly or
annually), either for life or for a fixed number of years. In case of the
death of the insured, or after the fixed annuity period expires for annuity
payments, the invested annuity fund is refunded, usually with some additional
amounts as per the terms of the policy.
Annuities / Pension
funds are different from from all other forms of life insurance
as an annuity policy / fund does not provide any life insurance cover
but merely offers a guaranteed income either for life or a certain
period. Therefore, this type of insurance is taken so as to get income
after the retirement.
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MAJOR PLAYERS IN INSURANCE INDUSTRY IN INDIA
Principles of Insurance
|
Types of Insurance
|
Major players in
insurance Sector in India
|
Till 01.04.2000, Insurance industry in India comprised mainly
of only two state insurers namely :-
Life Insurers:
- Life Insurance Corporation of India (LIC)
General
Insurers:
- General Insurance Corporation of India (GIC) (with effect from December, 2000, it has been made a National Reinsurer)
GIC had four subsidary companies, namely :-
- The Oriental Insurance Company Limited
- The New India Assurance Company Limited,
- National Insurance Company Limited
- United India Insurance Company Limited.
(However, with effect from Dec'2000, these
subsidiaries have been de-linked from the parent company and made as
independent insurance companies).
IN ADDITION TO ABOVE STATE INSURERS THE FOLLOWING
HAVE BEEN PERMITTED TO ENTER INTO INSURANCE BUSINESS :-
LIFE INSURERS
GENERAL INSURERS
HDFC-Chubb General Insurance Co. Ltd.
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Insurance business is divided into four classes :
1) Life Insurance business
2) Fire
3) Marine
4) Miscellaneous Insurance.
Life Insurers transact life insurance business; the rest is transacted by General Insurers. No composites are permitted as per law.
The business of Insurance essentially means defraying risks attached to any activity over time (including life) and sharing the risks between various entities, both persons and organisations. Insurance companies (ICs) are important players in financial markets as they collect and invest large amounts of premium. Insurance products are multi purpose and offer the following benefits :
1. Protection to the investors
2. Accumulate savings
3. Channelise savings into sectors needing huge long term investments.
ICs receive, without much default, a steady cash stream of premium or contributions to pension plans. Various actuary studies and models enable them to predict, relatively accurately, their expected cash outflows. Liabilities of ICs being long-term or contingent in nature, liquidity is excellent and their investments are also long-term in nature. Since they offer more than the return on savings in the shape of life-cover to the investors, the rate of return guaranteed in their insurance policies is relatively low.
Consequently, the need to seek high rates of returns on their investments is also low. The risk-return trade off is heavily tilted in favour of risk. As a combined result of all this, investments of insurance companies have been largely in bonds floated by GOI, PSUs, state governments, local bodies, corporate bodies and mortgages of long term nature. The last place where Insurance companies are expected to be over-active is bourses.
1) Life Insurance business
2) Fire
3) Marine
4) Miscellaneous Insurance.
Life Insurers transact life insurance business; the rest is transacted by General Insurers. No composites are permitted as per law.
The business of Insurance essentially means defraying risks attached to any activity over time (including life) and sharing the risks between various entities, both persons and organisations. Insurance companies (ICs) are important players in financial markets as they collect and invest large amounts of premium. Insurance products are multi purpose and offer the following benefits :
1. Protection to the investors
2. Accumulate savings
3. Channelise savings into sectors needing huge long term investments.
ICs receive, without much default, a steady cash stream of premium or contributions to pension plans. Various actuary studies and models enable them to predict, relatively accurately, their expected cash outflows. Liabilities of ICs being long-term or contingent in nature, liquidity is excellent and their investments are also long-term in nature. Since they offer more than the return on savings in the shape of life-cover to the investors, the rate of return guaranteed in their insurance policies is relatively low.
Consequently, the need to seek high rates of returns on their investments is also low. The risk-return trade off is heavily tilted in favour of risk. As a combined result of all this, investments of insurance companies have been largely in bonds floated by GOI, PSUs, state governments, local bodies, corporate bodies and mortgages of long term nature. The last place where Insurance companies are expected to be over-active is bourses.
Lately ICs have ventured into pension schemes and mutual
funds also. However, life insurance, constitutes the major share of insurance
business. Life Insurance depends upon the laws of mortality and there lies the
difference between life and general insurance businesses. Life has to
extinguish sooner or later and the claim in respect of life is certain. In case
of general insurance, however, there may never be a claim and the amount can
never be ascertained in advance. Hence, Life Insurance includes, besides
covering the risk of early happening of an event, an element of savings also
for the beneficiaries.
Pension business also derives from life insurance in as much as the pension outgo again depends upon the laws of mortality. The forays made by insurance companies in this area are, therefore, natural corollary of their business.
Regulators
Insurance is a federal subject in India. The primary legislation that deals with insurance business in India is: Insurance Act, 1938, and Insurance Regulatory & Development Authority Act, 1999.
Insurance Industry has ombudsmen in 12 cities. Each ombudsmen is empowered to redress customer grievances in respect of insurance contracts on personal lines where the insured amount is less than Rs. 20 lakhs, in accordance with the Ombudsmen Scheme.
Insurance Regulatory & Development Authority (IRDA)
IRDA was constituted by an act of parliament. The Authority is a ten member team consisting of:
(a) a Chairman
(b) five whole-time members
(c) four part-time members
(1) Subject to the provisions of Section 14 of IRDA Act, 1999 and any other law for the time being in force, the Authority shall have the duty to regulate, promote and ensure orderly growth of the insurance business and re-insurance business.
(2) Without prejudice to the generality of the provisions contained in sub-section (1), the powers and functions of the Authority shall include, -
(a) issue to the applicant a certificate of registration, renew, modify, withdraw, suspend or cancel such registration;
(b) protection of the interests of the policy holders in matters concerning assigning of policy, nomination by policy holders, insurable interest, settlement of insurance claim, surrender value of policy and other terms and conditions of contracts of insurance;
(c) specifying requisite qualifications, code of conduct and practical training for intermediary or insurance intermediaries and agents;
(d) specifying the code of conduct for surveyors and loss assessors;
(e) promoting efficiency in the conduct of insurance business;
(f) promoting and regulating professional organisations connected with the insurance and re-insurance business;
(g) levying fees and other charges for carrying out the purposes of this Act;
(h) calling for information from, undertaking inspection of, conducting enquiries and investigations including audit of the insurers, intermediaries, insurance intermediaries and other organisations connected with the insurance business;
(i) control and regulation of the rates, advantages, terms and conditions that may be offered by insurers in respect of general insurance business not so controlled and regulated by the Tariff Advisory Committee under section 64U of the Insurance Act, 1938 (4 of 1938);
Pension business also derives from life insurance in as much as the pension outgo again depends upon the laws of mortality. The forays made by insurance companies in this area are, therefore, natural corollary of their business.
Regulators
Insurance is a federal subject in India. The primary legislation that deals with insurance business in India is: Insurance Act, 1938, and Insurance Regulatory & Development Authority Act, 1999.
Insurance Industry has ombudsmen in 12 cities. Each ombudsmen is empowered to redress customer grievances in respect of insurance contracts on personal lines where the insured amount is less than Rs. 20 lakhs, in accordance with the Ombudsmen Scheme.
Insurance Regulatory & Development Authority (IRDA)
IRDA was constituted by an act of parliament. The Authority is a ten member team consisting of:
(a) a Chairman
(b) five whole-time members
(c) four part-time members
(1) Subject to the provisions of Section 14 of IRDA Act, 1999 and any other law for the time being in force, the Authority shall have the duty to regulate, promote and ensure orderly growth of the insurance business and re-insurance business.
(2) Without prejudice to the generality of the provisions contained in sub-section (1), the powers and functions of the Authority shall include, -
(a) issue to the applicant a certificate of registration, renew, modify, withdraw, suspend or cancel such registration;
(b) protection of the interests of the policy holders in matters concerning assigning of policy, nomination by policy holders, insurable interest, settlement of insurance claim, surrender value of policy and other terms and conditions of contracts of insurance;
(c) specifying requisite qualifications, code of conduct and practical training for intermediary or insurance intermediaries and agents;
(d) specifying the code of conduct for surveyors and loss assessors;
(e) promoting efficiency in the conduct of insurance business;
(f) promoting and regulating professional organisations connected with the insurance and re-insurance business;
(g) levying fees and other charges for carrying out the purposes of this Act;
(h) calling for information from, undertaking inspection of, conducting enquiries and investigations including audit of the insurers, intermediaries, insurance intermediaries and other organisations connected with the insurance business;
(i) control and regulation of the rates, advantages, terms and conditions that may be offered by insurers in respect of general insurance business not so controlled and regulated by the Tariff Advisory Committee under section 64U of the Insurance Act, 1938 (4 of 1938);
j) specifying the form and manner in which books of
account shall be maintained and statement of accounts shall be rendered by
insurers and other insurance intermediaries;
(k) regulating investment of funds by insurance companies;
(l) regulating maintenance of margin of solvency;
(m) adjudication of disputes between insurers and intermediaries or insurance intermediaries;
(n) supervising the functioning of the Tariff Advisory Committee; (o) specifying the percentage of premium income of the insurer to finance schemes for promoting and regulating professional organisations referred to in clause (f);
(p) specifying the percentage of life insurance business and general insurance business to be undertaken by the insurer in the rural or social sector; and
(q) exercising such other powers as may be prescribed
Tariff Advisory Committee (TAC)
(Statutory Body under Insurance Act 1938)
Tariff Advisory Committee controls and regulates the rates, advantages, terms and conditions that may be offered by insurers in respect of General Insurance Business relating to Fire, Marine (Hull), Motor, Engg. and Workmen Compensation.
Effective 22/07/98,the TAC Board has been reconstituted with seven members representing the present General Insurance Industry and eight members from government and Industry.
The Controller of Insurance cum Chairman IRDA is the Chairman of TAC.
Updated list of all Insurance Companies in India (July 2010)
Insurance industry, earlier comprised of only two state insurers.
Life Insurers ie Life Insurance Corporation of India (LIC) and General Insurers ie General Insurance Corporation of India (GIC) GIC had four subsidary companies.
With effect from Dec'2000, these subsidaries have been de-linked from parent company and made as an independent insurance companies. Oriental Insurance Company Limited, New India Assurance Company Limited, National Insurance Company Limited and United India Insurance Company Limited.
The first batch of licenses were issued by the Insurance Regulatory and Development Authority (IRDA) in 2001. As on December 2009 following are the players in the Indian Market:
The total number of life insurers registered with the Authority has gone up to 23. While, the total number of general insurers registered with IRDA is also now 23.
LIFE INSURERS IN INDIA
Bajaj Allianz Life Insurance Company Limited
Birla Sun Life Insurance Co. Ltd
HDFC Standard Life Insurance Co. Ltd
ICICI Prudential Life Insurance Co. Ltd
IndiaFirst Life Insurance Company Ltd
ING Vysya Life Insurance Company Ltd.
Life Insurance Corporation of India
Max New York Life Insurance Co. Ltd
Met Life India Insurance Company Ltd.
Kotak Mahindra Old Mutual Life Insurance Limited
SBI Life Insurance Co. Ltd
Tata AIG Life Insurance Company Limited
Reliance Life Insurance Company Limited.
Aviva Life Insurance Company India Limited
Sahara India Life Insurance Co, Ltd.
Shriram Life Insurance Co, Ltd.
Bharti AXA Life Insurance Company Ltd.
Future Generali India Life Insurance Company Limited
IDBI Fortis Life Insurance Company Ltd.
Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.
Aegon Religare Life Insurance Company Limited
DLF Pramerica Life Insurance Company Limited
Star Union Dai-Ichi Life Insurance Company Limited
(k) regulating investment of funds by insurance companies;
(l) regulating maintenance of margin of solvency;
(m) adjudication of disputes between insurers and intermediaries or insurance intermediaries;
(n) supervising the functioning of the Tariff Advisory Committee; (o) specifying the percentage of premium income of the insurer to finance schemes for promoting and regulating professional organisations referred to in clause (f);
(p) specifying the percentage of life insurance business and general insurance business to be undertaken by the insurer in the rural or social sector; and
(q) exercising such other powers as may be prescribed
Tariff Advisory Committee (TAC)
(Statutory Body under Insurance Act 1938)
Tariff Advisory Committee controls and regulates the rates, advantages, terms and conditions that may be offered by insurers in respect of General Insurance Business relating to Fire, Marine (Hull), Motor, Engg. and Workmen Compensation.
Effective 22/07/98,the TAC Board has been reconstituted with seven members representing the present General Insurance Industry and eight members from government and Industry.
The Controller of Insurance cum Chairman IRDA is the Chairman of TAC.
Updated list of all Insurance Companies in India (July 2010)
Insurance industry, earlier comprised of only two state insurers.
Life Insurers ie Life Insurance Corporation of India (LIC) and General Insurers ie General Insurance Corporation of India (GIC) GIC had four subsidary companies.
With effect from Dec'2000, these subsidaries have been de-linked from parent company and made as an independent insurance companies. Oriental Insurance Company Limited, New India Assurance Company Limited, National Insurance Company Limited and United India Insurance Company Limited.
The first batch of licenses were issued by the Insurance Regulatory and Development Authority (IRDA) in 2001. As on December 2009 following are the players in the Indian Market:
The total number of life insurers registered with the Authority has gone up to 23. While, the total number of general insurers registered with IRDA is also now 23.
LIFE INSURERS IN INDIA
Bajaj Allianz Life Insurance Company Limited
Birla Sun Life Insurance Co. Ltd
HDFC Standard Life Insurance Co. Ltd
ICICI Prudential Life Insurance Co. Ltd
IndiaFirst Life Insurance Company Ltd
ING Vysya Life Insurance Company Ltd.
Life Insurance Corporation of India
Max New York Life Insurance Co. Ltd
Met Life India Insurance Company Ltd.
Kotak Mahindra Old Mutual Life Insurance Limited
SBI Life Insurance Co. Ltd
Tata AIG Life Insurance Company Limited
Reliance Life Insurance Company Limited.
Aviva Life Insurance Company India Limited
Sahara India Life Insurance Co, Ltd.
Shriram Life Insurance Co, Ltd.
Bharti AXA Life Insurance Company Ltd.
Future Generali India Life Insurance Company Limited
IDBI Fortis Life Insurance Company Ltd.
Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.
Aegon Religare Life Insurance Company Limited
DLF Pramerica Life Insurance Company Limited
Star Union Dai-Ichi Life Insurance Company Limited
Bancassurance
Bancassurance symbolises the convergence of banking and insurance. The term has its origins in France and involves distribution of insurance products through a bank's branch network. While bancassurance has developed into a tremendous success story in Europe, it is a relatively new concept in Australia and Asia.
Most new insurers have entered into memoranda of understanding with banks to use their branches as outlets for marketing standard products. State Bank of India, Vysya Bank and J&K Bank already have joint ventures in life insurance. Vijaya Bank and Punjab National Bank are in the midst of finalising life and non-life ventures.
The Insurance Act allows only those companies registered under the Companies Act to become corporate agents. This gives the new generation and old private sector banks a head start over Public sector banks , which are technically not eligible to sell risk products.
IRDA, IBA & RBI are in discussions to iron out the various issues, as public sector banks will play a key role in the distribution of products.
Bancassurance symbolises the convergence of banking and insurance. The term has its origins in France and involves distribution of insurance products through a bank's branch network. While bancassurance has developed into a tremendous success story in Europe, it is a relatively new concept in Australia and Asia.
Most new insurers have entered into memoranda of understanding with banks to use their branches as outlets for marketing standard products. State Bank of India, Vysya Bank and J&K Bank already have joint ventures in life insurance. Vijaya Bank and Punjab National Bank are in the midst of finalising life and non-life ventures.
The Insurance Act allows only those companies registered under the Companies Act to become corporate agents. This gives the new generation and old private sector banks a head start over Public sector banks , which are technically not eligible to sell risk products.
IRDA, IBA & RBI are in discussions to iron out the various issues, as public sector banks will play a key role in the distribution of products.
Policies/Guidelines
1. The Insurance Regulatory & Development Authority (IRDA) has issued revised guidelines licensing of corporate agents. Irda has stipulated that the decision to engage any person as corporate agent will be taken only in the corporate office of the insurance company and proceedings appointing the person as corporate agent will be issued by an officer who will specially be designated by the chief executive officer to issue to such orders. Insurers have been directed to carry out 'surprise inspections' of the books and records of the group organiser or manager at least once a year to ensure total compliance.
2. Irda has set a new deadline of December 2006 to complete the price deregulation system in the domestic general industry. Currently almost 70% of the general insurance market functions under the tariff system which is fixed by Tariff Advisory Committee (TAC), a constitutional body supervised by Irda. The intention of such road map is to see that there is an orderly movment from the present regime to the future set up.While IRDA assumes that all lines of business would be detariffed, to start with it may be limited to lines other than motor in view of of the sizeable share the motor premium commands in the overall premium collected by the insurers and the large number of policyholders involved in this lines of business.
3. IRDA has clarified, that the function of underwriting and rating of insurance business should be independent of the business development function and not be made subservient to the business development function.
1. The Insurance Regulatory & Development Authority (IRDA) has issued revised guidelines licensing of corporate agents. Irda has stipulated that the decision to engage any person as corporate agent will be taken only in the corporate office of the insurance company and proceedings appointing the person as corporate agent will be issued by an officer who will specially be designated by the chief executive officer to issue to such orders. Insurers have been directed to carry out 'surprise inspections' of the books and records of the group organiser or manager at least once a year to ensure total compliance.
2. Irda has set a new deadline of December 2006 to complete the price deregulation system in the domestic general industry. Currently almost 70% of the general insurance market functions under the tariff system which is fixed by Tariff Advisory Committee (TAC), a constitutional body supervised by Irda. The intention of such road map is to see that there is an orderly movment from the present regime to the future set up.While IRDA assumes that all lines of business would be detariffed, to start with it may be limited to lines other than motor in view of of the sizeable share the motor premium commands in the overall premium collected by the insurers and the large number of policyholders involved in this lines of business.
3. IRDA has clarified, that the function of underwriting and rating of insurance business should be independent of the business development function and not be made subservient to the business development function.
Insurance Products
More than 80% of the life insurance business is from Endowment Assurance (Participating), and Money Back (Participating products.
Fire and Miscellaneous insurance businesses are predominant. Motor Vehicle insurance is compulsory.
New products have been launched by life insurers. These include linked-products.
Insurance products from the new insurance companies now give a lot more options to customers. New insurance products are more transparent, flexible & customized to the need of different types of individuals. "Free-look" period of 10 days where customer has the option of returning the policy within 10 days if it does not meet his requirements. Loading of riders to basic range of products & thus providing lots of flexibility to the customers are few of the examples.
Insurance Companies are now providing information about their performance on a regular interval to bring transparency in declaring bonuses.
The Insurance Regulatory and Development Authority (IRDA) has reported that every life insurance company registered under the IRDA (Registration of Indian Insurance Companies) Regulations, 2000, can transact life insurance business which includes 'linked business'. After clearance from IRDA, the insurance companies must launch the products within three months from the date of clearance.
The number of new products cleared by the IRDA during the financial year 2009-10 in respect of private insurance companies was 236.
More than 80% of the life insurance business is from Endowment Assurance (Participating), and Money Back (Participating products.
Fire and Miscellaneous insurance businesses are predominant. Motor Vehicle insurance is compulsory.
New products have been launched by life insurers. These include linked-products.
Insurance products from the new insurance companies now give a lot more options to customers. New insurance products are more transparent, flexible & customized to the need of different types of individuals. "Free-look" period of 10 days where customer has the option of returning the policy within 10 days if it does not meet his requirements. Loading of riders to basic range of products & thus providing lots of flexibility to the customers are few of the examples.
Insurance Companies are now providing information about their performance on a regular interval to bring transparency in declaring bonuses.
The Insurance Regulatory and Development Authority (IRDA) has reported that every life insurance company registered under the IRDA (Registration of Indian Insurance Companies) Regulations, 2000, can transact life insurance business which includes 'linked business'. After clearance from IRDA, the insurance companies must launch the products within three months from the date of clearance.
The number of new products cleared by the IRDA during the financial year 2009-10 in respect of private insurance companies was 236.
Top Insurance Companies
Insurance is a nascent sector in
India providing a wide potential for the players worldwide. The premiums of
life insurance accounts to about 2.5 % of India's GDP while the premiums of the
general insurance accounts to about 0.65% GDP. In India the Insurance sector
went through a number of changes when the Indian Government allowed the private
companies to solicit insurance by allowing FDI up to 265%.The Indian Insurance
scenario received a boost up as the global insurance companies are craving for
a lion's share. The Insurance Companies like LIC, Bajaj Alliance,ICICI
Prudential are booming in this era. The list below will give the names of the
best Insurance Companies of India.
List
Of Top Insurance Companies Of India
Life Insurance Corporation of India :
This leading Insurance company of India was
established in the year 1956 by the alliance of 16 non-Indian companies,154
Indian Insurance Companies and 75 provident. It has 100 divisional offices,2048
computerized branches,7 zonal offices and the company's corporate office. It
has introduced new strategies for the facilitation of the customers like the
IVRS,ECS,ATM Premium payment facility and the company's Info centers in Mumbai,
Delhi, Chennai, Kolkata and many others cities.
Bajaj Allianz Life Insurance:
This Indian Insurance company is a joint
venture of Alliance AG,which is one among the largest Life Insurance companies
and Bajaj Auto,one among the biggest 2- & 3 wheeler producers in the world.
The Company has various plans for the customers like the
Pension,Retirement,Life Time Care,Health Care,Life Insurance Online,Life
Insurance Saving Plans, and online services like the Address change,Renewal
Premium Payment etc.
Tata AIG Life :
This renowned
life Insurance company in India offers a wide array of products related to life
insurance for associations,individuals and businesses. The company offers high
quality solutions to its corporate Indian clients. It renders services like the
AIG Health First,AIG Health Life Protector, Tata AIG Life Hospi Cash Back, Tata
AIG Life Maha Gold, Tata AIG Life Assure 10 Years and many others. The company
is a joint venture of America International Group and TATA group.
Birla Sun Life Insurance:
It is one of the major
insurance companies in India and a joint venture of Sun Life Financials and
Aditya Birla group. The company provides Life Insurance Solutions to meet the
needs of Protection, Retirement and Saving .It has recently launched the Money
back Plus Plan and offers Insurance programs like the
Children,NRI,Riders,Health etc.
SBI Life :
This renders premium
Insurance solutions like SBI Life-Smart ULIP,SBI Life-Group Criti9, SBI
Life-Unit Plus Child Plan etc. It also offers services like the NRI
services,Premium Payment Procedure,ECS Facility,RPI/RFI and many others. SBI
Life is a joint venture of BNP Paribas Assurance and SBI.
Max New York Life:
This Life Insurance
company in India provides the best solutions related to life insurance like
children's plan, retirement solution, Investment, Protection, Health,Savings
etc. The company has 14 corporate agency tie ups, 33 bankassurance
relationships and direct sales force at 14 locations. It is now covering 36
products related to life and health insurance.
Kotak Life Insurance:
This premier
Insurance company in India offers insurance facilities related to
Savings,Investments,Child,Retirement,Protection, Kotak Long Life Secure
Plus,Kotak Long Life Health Plus etc. It opens up services like Insurance
Guide, NAV, Premium Payment Options and many others.
HDFC Standard Life:
This is one of
the major market leaders in the insurance sector in India. The company offers
Insurance services like the Group Plans,Health Plans,Protection
Plans,Retirement Plans,Savings and Investment Plans etc. The customer base of
the company is about more than 7 million who depend on the company for
pension,investment,banking needs.
Reliance Life :
The company
based in India offers the best plans for Life Insurance in India. Reliance
Capital Limited's associate company is Reliance Life which is one of the
leading private sectors in India. The company provides the Protection
Plans,Child Plans,Retirement Plans and Investment plans and is also the
ultimate solver of solutions for Groups and Individuals.
ICICI Prudential:
This major Insurance
Company in India provides health Insurance,life insurance,ULIPs,ULIP,Retirement
Plans and many others. Life Insurance Plans of the company covers Premium
Guarantee Plans,Education Insurance Plans etc. Pension Plans encompass
LifeStage Pension,Forever Life. Health Insurance Plans cover Hospital
Care,MediAssure.
INDIAN INSURANCE INDUSTRY:
Insurers
Insurance industry, as on 1.4.2000, comprised mainly two players: the state insurers:
Life Insurers:
Insurers
Insurance industry, as on 1.4.2000, comprised mainly two players: the state insurers:
Life Insurers:
General Insurers:
- General Insurance Corporation of India (GIC) (with effect from Dec'2000, a National Reinsurer)
GIC had four subsidary companies,
namely ( with effect from Dec'2000, these subsidaries have been de-linked from
the parent company and made as independent insurance companies.
- The Oriental Insurance Company Limited
- The New India Assurance Company Limited
- National Insurance Company Limited
- United India Insurance Company Limited.
Yr: 2000-2001
: ( From 2nd April '2000 to 31st
December'2001)
Insurance Industry in the year 2000-2001 had 16 new entrants, namely:
Life Insurers:
Insurance Industry in the year 2000-2001 had 16 new entrants, namely:
Life Insurers:
S.No.
|
Registration
Number |
Date of Reg.
|
Name of the Company
|
1
|
101
|
23.10.2000
|
|
2
|
104
|
15.11.2000
|
|
3
|
105
|
24.11.2000
|
|
4
|
107
|
10.01.2001
|
|
5
|
109
|
31.01.2001
|
|
6
|
110
|
12.02.2001
|
|
7
|
111
|
30.03.2001
|
|
8
|
114
|
02.08.2001
|
|
9
|
116
|
03.08.2001
|
|
10
|
117
|
06.08.2001
|
General Insurers :
S.No.
|
Registration Number
|
Date of Registration
|
Name of the Company
|
1
|
102
|
23.10.2000
|
|
2
|
103
|
23.10.2000
|
|
3
|
106
|
04.12.2000
|
|
4
|
108
|
22.01.2001
|
|
5
|
113
|
02.05.2001
|
|
6
|
115
|
03.08.2001
|
Yr: 2001-2002 : ( From 1st Jan 2001 to Dec. 2002)
Insurance Industry in this year, so far has 5new entrants; namely
Life Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
121
|
03.01.2002
|
|
2
|
122
|
14.05.2002
|
General Insurers :
S.No.
|
Registration Number
|
Date of Registration
|
Name of the Company
|
1
|
123
|
15.07.2002
|
|
2.
|
124
|
27.08.2002
|
|
3.
|
125
|
27.08.2002
|
Yr: 2003-2004 : (
From 1st Jan 2003 till Date)
Insurance Industry in this year, so far has 1new entrants; namely
Life Insurers:
Insurance Industry in this year, so far has 1new entrants; namely
Life Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
127
|
06.02.2004
|
|
Yr: 2004-2005 :
Insurance Industry in this year, so far has 1new entrants; namely
Life Insurers:
Insurance Industry in this year, so far has 1new entrants; namely
Life Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
128
|
17.11.2005
|
|
Yr: 2006-2007 :
Insurance Industry in this year, had
1new entrants; namely
Life Insurers:
Life Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
130
|
14.07.2006
|
|
Yr: 2007-2008 :
Insurance Industry in this year, had
5 new entrants; namely
Life Insurers:
Life Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
133
|
04.09.2007
|
|
2
|
135
|
19.12.2007
|
|
General Insurers:
|
|||
3
|
131
|
03-08-2007
|
|
4
|
132
|
04-09-2007
|
|
5
|
134
|
16-11-2007
|
|
Yr: 2008-2009 :
Insurance Industry in this year, so far has 3 new entrants in Life and 1 new entry in General ; namely
Life Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
136
|
08.05.2008
|
|
2
|
138
|
27.06.2008
|
|
3
|
140
|
27.06.2008
|
|
4
|
142
|
Star
Union Dai-ichi Life Insurance Co. Ltd.,
|
|
5
|
143
|
05.11.2009
|
IndiaFirst Life Insurance Company Ltd.
|
General Insurers:
S.No.
|
Registration
Number |
Date
of Reg.
|
Name
of the Company
|
1
|
137
|
8.05.2008
|
|
2
|
139
|
27.06.2008
|
|
3
|
141
|
15.12.2008
|
Raheja QBE General Insurance Co. Ltd
|
INSURANCE BUSINEES:
Insurance business is divided into
four classes :
1) Life Insurance 2) Fire Insurance
3) Marine Insurance and 4) Miscellaneous Insurance.
Life Insurers transact life
insurance business; General Insurers transact the rest.
No composites are permitted as per
law.
LEGISLATION (as on 1.4.2000):
Insurance is a federal subject in
India. The primary legislation that deals with insurance business in India
is:
Insurance Act, 1938, and Insurance
Regulatory & Development Authority Act, 1999.
INSURANCE PRODUCTS (as on 1.4.2000) (for latest information get in touch
with the current insurers – website information of insurers is provided at the
web page for insurers ):
Life Insurance:
Life Insurance:
Popular Products: Endowment
Assurance (Participating), and Money Back (Participating). More than 80% of the
life insurance business is from these products.
General Insurance:
General Insurance:
Fire and Miscellaneous insurance
businesses are predominant. Motor Vehicle insurance is compulsory.
Tariff Advisory Committee (TAC) lays
down tariff rates for some of the general insurance products (please visit
website of GIC for details )
2001
New products have been launched by life insurers. These include linked-products. For details, please visit the websites of life insurers.
New products have been launched by life insurers. These include linked-products. For details, please visit the websites of life insurers.
INFORMATION
About the insurance industry, the
following documents may be helpful:
Malhotra Committee Report (The
Report of the Committee on Reforms in the Insurance Sector);
IRDA's First Annual Report - 2001
CUSTOMER PROTECTION:
Insurance Industry has Ombudsmen in 12 cities. Each Ombudsman is empowered to redress customer grievances in respect of insurance contracts on personal lines where the insured amount is less than Rs. 20 lakhs, in accordance with the Ombudsman Scheme. Addresses can be obtained from the offices of LIC and other insurers.
Insurance Industry has Ombudsmen in 12 cities. Each Ombudsman is empowered to redress customer grievances in respect of insurance contracts on personal lines where the insured amount is less than Rs. 20 lakhs, in accordance with the Ombudsman Scheme. Addresses can be obtained from the offices of LIC and other insurers.
Private Insurance Companies in India
Insurance industry in India is one of the flourishing
sectors, especially general and life insurance which accounts for 2.5% and
0.65% respectively of total India's GDP. The growth has opened an array of
opportunities for global firms to either set-up their division in India or to
enter into a joint venture with the Private Insurance Companies in India.
The industry has witnessed many
alterations especially post 1999 when the Indian government allowed the
privatization of the sector to promote insurance for attracting FDI up to 25%.
Since then the Indian Insurance industry is regarded as a booming market
amongst the international insurance firms. Although, the biggest insurance firm
in India is still controlled and governed by the government.
List
of Private Insurance Companies in India
There is a long list of Private Insurance Companies in India. Some of the popular ones are:
- Bajaj Allianz - A joint venture between Bajaj Finserv and Allianz SE, Bajaj Allianz Life Insurance Co. Ltd. is one of the major insurance players in national and international market with assets more than a trillion to its credit. It has its units in 70 nations all across the world and has deployed more than 50,000 Insurance Advisers in its different units. The insurer deals with both general and life insurance and after it joined hands with Thomas Cook India; travel finance has been one of its hottest selling plans. Bajaj Allianz guarantees world-class insurance and investment schemes besides providing customized plans assisted by excellent technology. Some of its popular plans are: Unit Linked Plans, Micro Insurance, Children Plans, Health Plans, Women Insurance Plans, Term Plans, Pension Plans, etc.
- ICICI Prudential Life Insurance - A tie-up between Prudential plc and ICICI Bank, ICICI Prudential Life Insurance Company with his headquarters in UK and more than 2000 divisions and 1,117 sub-divisions is one of the flourishing global financial services group. The firm was felicitated by AAA rating from Fitch ratings in terms of financial strength. The company offers various insurance schemes that have been created by keeping customers' needs into consideration. Some of its popular plans are: Rural Plans, ICICI Pru Group Solutions Advantage, Health Coverage Plans, Protection Plans, Retirement Solutions, Wealth Creation Plans, Education Insurance Plans, etc.
- ING Vysya Life Insurance - ING Vysya Life Insurance is a collaboration between Vysya Bank and ING Insurance Co. Coming into action in the year 2001, the firm has its main office in Bangalore and 140 divisions all across the world. The insurance plans offered by ING Vysya guarantees complete monetary security to the policy holders' family after his demise. It specializes in providing life and general insurance along with medical, group, company and Long-Term Care Insurances. Some of its popular plans are: Protection Plans, Retirement Plans, Savings Plans, Investment Plans, etc.
- Max New York Life Insurance - A joint venture between New York Life International and Max India Limited, the firm began its financial functions in India in 2001. It takes pride of being one of the the first life insurance firm to be felicitated by the IS0 9001:2000 status. With over 133 divisions all over India, Max New York provides an assortment of flexible scheme enveloping both health and life insurances. The company offers different plans based on individual needs and to meet its long term fiscal objectives. Some of its popular plans are: Strategic Products Plans, Retirement Plans, Savings Plans, Health Plans, Children Plans, Protection Plans, Investment Plans, etc.
- Tata AIG Life Insurance - The Limited firm is a joint venture between American International Group, Inc. (AIG) and Tata Group. It is one of the biggest commercial groups in India and provides variety of standard and customized life insurance schemes. Some of its popular plans are: Life Assure Educare, Life InvestAssure Plus, etc for children; Life Easy Retire, Life Health Protector, Life Assure Lifeline Plans, etc for adults and Life InvestAssure Swarna Jeevan, Life InvestAssure Future, etc for easy Retirement Planning.
- Bharti AXA Life Insurance - With businesses in the field of retail, telecom and agriculture, Bharti AXA Life Insurance Co. Ltd. over the years has become a major commercial group in India which offers financial security and wealth administration. It is a joint venture between AXA and Bharti and has its divisions in nations like Thailand, Western Europe, Indonesia, Malaysia, New Zealand, Philippines, Singapore, Australia, etc. Some of its popular plans are: Group Plans like Bharti AXA Life Credit Shield, Bharti AXA Swasthya Sanjeevani, Bharti AXA Sanjeevani, etc. and Individual Plans like Bharti AXA Invest Confident, Bharti AXA Spot Suraksha, Bharti AXA Dream Life Pension, Bharti AXA Wealth Confident, etc.
- Aviva Life Insurance - A tie up between Dabur group of and Aviva insurance group, Aviva is the fifth biggest insurance firm in the world. It started its operations in 1834 and was the first company to introduce the concept of Bancassurance in India. It provides schemes that offer flexibility and worth to its customers. Some of its popular plans are: Whole Life Plans, Endowment Plans, Pension Plans, Group Plans, Child Plans, Pure Term Plans, Single Premium Plans, Health Plans, etc.
·
Insurance Regulatory and Development Authority - IRDA
·
IRDA - Duties,Powers and Functions
Section 14 of IRDA Act, 1999 lays down the duties, powers and functions of IRDA..(1) Subject to the provisions of this Act and any other law for the time being in force, the Authority shall have the duty to regulate, promote and ensure orderly growth of the insurance business and re-insurance business.
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