INSURANCE MARKET IN INDIA(ONLY 2 SIDES)

Indian insurance industry is a flourishing industry with several national and international players competing and growing at rapid rates. All this can be attributed to the reforms leading to the relaxation of the policy regulations that ignited the growth of the Indian insurance industry. The level of awareness and consciousness has risen among people for the need to insure them and elevation in the levels of literacy, population and urbanisation has added fuel to the fire leading to ever growing demand of the insurance products. The period from 2010-2015 has been regarded as the GOLDEN AGE for the Indian insurance industry probably because of the future prosperous growth predictions of the industry. The LIFE INSURANCE CORPORATION OF INDIA dominated the industry till 1990s after which few private players started entering the market. The annual growth rate of the Indian insurance industry varies between 15% - 20%. The entry of the private players in the industry around 2000-2001 initiated the growth of the industry. A study conducted by the Federation of Indian chamber of commerce and industry and the US based Boston Consulting Group reveals that the awareness and total penetration of insurance services [premiums as % of GDP] in India has increased from 2.3% in 2001 to 5.2% in 2011. The report further provided information that the number of life insurance policies in the year 2011 was 12 times more than the last decade and number of people taking the health insurance has risen 25 times. India is a US $41billion industry. Currently, in India only two million people {.2% of the total population of 1 billion} are covered under Mediclaim whereas in developed nations like USA about 75% of the total population are covered under some insurance scheme. As far as the conventional plan of life insurance policies are concerned, there is a growth of 11% in policies and 22% in premium according to the Minister of State for Finance. The Indian health insurance market accounted for 3.2 per cent of the overall insurance industry in the fiscal year 2011-2012. Key factors driving the growth of the health insurance sector were rising healthcare expenditure, increasing disposable income and the rise in the number of people with affluent lifestyles. Though the health insurance market is currently dominated by public-sector companies, the top six private health insurance companies increased their cumulative market share from 17.2 per cent to 29.1 per cent during 2007 to 2011. Keeping all these things in mind targeting and positioning of the products can be done accordingly in areas where demand can be created and penetration is low THE WAY AHEAD A situation where almost all the major industries are suffering an economic meltdown, Indian

insurance industry can be said as one sector that is still experiencing a good economic growth. The adaptability of the industry to mould and shape itself as per the changing trends and lifestyle led it to carve out a safe path of growth and sustenance for itself. All the players in the industry are striving hard to provide the customers with the best possible solution through innovative, varied products and making their services easily accessible and more visible in the market. There is a tough competition in the industry each one trying to grab the market share of the other. Transition of the industry from non linked to unit linked insurance policies is one of the major change that lead to improvisation of the industrys services with the government liberalised policies and IRDA adding tint of flavour propagating the growth. The sector has immense potential as not even 50% of the population is insured in India. Growing population and rising standard of living of the people will further make the task of the companies less burdensome. More and more population can be insured only when the companies go for an extensive market research before actually designing or positioning their products and targeting them to the specific segments so that time and resources both can be saved. The companies should go and tap the rural population has there is huge rigorous strength in that crowd to provide with substantial profit margins. The focus of the insurance companies to target the densely populated areas instead of providing insurance to qualitative segment of the population can sweeten the emerging growing prospects of the industry. Its not far that India will become an insurance giant in the coming few years. A report by Deccan Herald predicts the Indian insurance industry to be worth $400 billion by the year 2020 further increasing the appeal of the industry. In a report titled, "India Life Insurance 2012: Fortune Favors the Bold," McKinsey & Co. sets out the positives. "All factors are in place for the Indian life insurance industry to blossom into one of the fastest-growing financial services markets in the world." So, we can say, the future of the industry is undoubtedly progressive and investment made in this sector would not go futile.