Introduction
The "fear" only four alphabets, like love, but both are very different in this sense. Whatever man (mishap) woman have families that love always begins with the background of fear. In general, so many have been asking themselves what would happen if we were not there, but continued to ask, rather than doing something about it. Time is precious, you do not stop at all and we live in a world of uncertainty; the uncertainty of work, the instability of the currency, the instability of the property and so the story continued throughout the life of a man.
a thriving insurance sector is vital to any modern economy. On the one hand, it encourages the habit of saving, and secondly because it provides a safety net in rural and urban enterprises and productive individuals. And perhaps most importantly, to generate long-term sources of invisible infrastructure building. The nature of the insurance business is to provide the cash flow of companies, until the payment is deferred and emergency-related.
This feature allows the business to insurance companies are the largest investors in long-gestation infrastructure development projects, all developed and emerging countries. This is the most compelling reason why the private sector (and foreign) companies, which will spread the habits of social insurance and consumer interests are urgently needed in this vital economic sector. Opening the insurance private sector including foreign participation as a result of a variety of opportunities and challenges in India.
life insurance market
The life insurance market in India is underdeveloped market, which just tapped the state-owned LIC till the entry of private insurers. After the penetration of life insurance products and 19 percent of the total population of 400 million can be ensured. insurance tax as the state-owned LIC sold a means, not a product that protection. Most customers were provided with low elasticity or lack of transparency in the products. The entry of private insurers in the rules of the game have changed.
The 12 private insurers in the life insurance market has been gripped by nearly 9 percent of the market for premium income. The new business premium of 12 private operators Rs 1000 crore tripled in 2002 to 03 last year. Meanwhile, having regard to the state-owned LIC new premium business fell.
Innovative products, smart marketing and aggressive marketing. This triple whammy combination that has enabled fledgling private insurance to sign up Indian customers faster than anyone had expected. Indians, who have always seen life insurance tax saving device suddenly turns to the private sector and snapping up new, innovative products to offer.
The growing popularity of private insurers prove otherwise. They are squeezing money from new niches to which they preside. State-owned enterprises still dominate segments like endowments and money back policy. But the pension or annuity products business, private insurers have been twisted more than 33 percent of the market. And the popular unit-linked insurance schemes are practically a monopoly, more than 90 percent of customers.
Private insurers also seem to have great defense in other ways- persuading people to make up the larger policy. For example, the average size of about a life insurance policy before privatization Rs 50,000. It has grown to about Rs 80,000. But the private insurance companies ahead in this game, and the average size is around Rs 1.1 lakh policies Rs 1.2 lakh- way higher than the industry average.
Buoyed by a faster than expected success, rapid transmission of nearly all private insurers in the second phase of the expansion plans. There is no doubt that the aggressive stance of private insurers is already paying rich dividends. But the rejuvenated LIC is also trying to fight to woo new customers.
Insurance today
In 1993, Malhotra Committee headed by former Finance Secretary and RBI Governor RN Malhotra, was formed to evaluate the Indian insurance industry and suggests a future direction. The Malhotra committee was set up with the aim of which is complementary to the initiated reforms in the financial sector.
setting, the Insurance Regulatory Development Authority (IRDA) started reforms in the insurance sector. Then it became necessary, if we compare the insurance premium per capita penetration and per capita will be far behind the rest of the world. The above table gives the statistics for the year 2000
The expected growth in the per capita income of 6% in the next 10 years and the improvement in the level of awareness, the demand for insurance is expected to increase.
As an independent consulting firm, Monitor Group estimates that the growth form Rs. Rs 218 billion. 1003 billion in 2008 estimations seem feasible than the performance of 13 life insurance players in India in the years 2002 to 2003 (up to October based on the first year premium) of Rs. 66683000 LIC that the greatest extent of Rs. 59 187 million. Since LIC now has 2050 branches in 7 zones 5,60,000 strong team of agents.
IMPACT OF GLOBALISATION
While the nationalized insurance companies have performed commendable job expansion of the business volume, opening up the insurance industry's own players were needed in the context of the globalization of the financial sector. If the traditional semi public goods and infrastructure industries, such as banking, airlines, telecommunications, energy, etc. The presence of significant private sector continued state monopoly on insurance was indefensible, and that the globalization of the insurance has been previously discussed. The effect has been to create a variety of opportunities and challenges visible form.
The introduction of private sector actors added to the muted colors of the industry. The initiatives of the private players are very competitive, and I have a huge competition in the market monopoly of LIC time. Since the advent of private players in the industry has seen new and innovative measures taken by the players in the sector. The new players have improved the quality of service of insurance. As a result, LIC years of falling down her career. Market share was divided among the private players. While LIC is still 75% due to the impending nature of the insurance sector to private operators enough to compete more of LIC in the near future. LIC's market share decreased from 95% (2002-03), 81% (2004-05). The company is following the rest of the market share in the insurance sector.
TABLE – 1
IMPACT OF GLOBALISATION
player's name in market share (%)
82.3 LIC
ICICI PRUDENTIAL 5, 63
2.56 Birla Sun Life
ALLIANZ BAJA 2.03
1.80 SBI LIFE
HDFC STANDARD 1:36
TATA AIG 1.29
0.90 MAX NEW YORK
AVIVA 0.79
OM Kotak Mahindra 0.51
ING Vyasa 0.37
AMP Sanmar 0.26
MetLife 0.21
in this case, globalization
a tough battle to expand the market share of private sector life insurance industry, which 14 life insurance companies, 26% lost 3% market share in the state-owned life insurance Corporation (LIC) in the domestic life insurance industry in 2006-07. According to data published Insurance Regulatory and Development Authority, the total fee of 14 companies went up 90% Rs 19,471.83 crore in 2006-07 Rs 10, 252 crore.
LIC total premium of Rs 55 934 crore mobilization was able to maintain a market share of 74.26% during the reporting period. Overall, the life insurance industry in the first year premium grew 110% over Rs 75, 406 crore in 2006-07. The 2006-07 performance threw a few surprises in the ranking of private sector life insurance companies. New entrants such as Reliance Life and SBI Life has shown tremendous growth over 381% and 210% during the year. Reliance Life, which became one of the top five companies in the premium of Rs 930 crore during the year of the year.
Although ICICI Prudential Life Insurance has remained as the No 1 private sector life insurance company during the year. Bajaj Allianz has overtaken ICICI Prudential Monthly terms of market share in March, for the first time. Private operators are not one-time fee Bajaj's market share in March was 29.1% vs. ICICI Prudential 23.8%. Bajaj gained 4.6 percentage points of market share in the distribution of the private sector in FY07.
among private players, SBI Life and Reliance Life is still good, everything is becoming a 4% market share in FY07. SBI Life ascendance growing contribution of ULIP premiums. Another notable developments in the 2006-07 performance has been the expansion of the retail markets for life insurance comapnies. Bajaj Life Insurance Alliannz has added 20 lakh policies while ICICI Prudential has expanded over 19 lakh policies during the year.
Most life insurance policies in force in the world, insurance happens to be a mega facility in India. This is a business growing at the rate of 15-20 percent per year, currently the order of Rs 450,000,000,000th Together with banking services, it adds about seven per cent of the country's GDP. Gross premium collection to-GDP ratio and the available funds by nearly 2 percent to 8 percent of GDP investment in LIC.
Still, nearly 80 percent of the Indian population does not cover life insurance, while health insurance and non-life insurance also falls short of international standards. And this part applies to the population of poor social security and pension systems were just the security of retirement income. This in itself indicates that the enormous growth potential for the insurance sector.
developed and evolved insurance sector is needed for economic development as it provides the long-term resources for infrastructure development and also strengthen the risk-taking ability. It is estimated that India would be in the magnitude of $ 1000000000000 investments needed over the next ten years. The insurance sector to some extent is to enable infrastructure projects to sustain economic growth in the country.
insurance is a federal subject in India. There are two laws that govern the insurance sector of the IRDA ACT 1938 and ACT 1999 The insurance sector in India has become a full circle from being an open competitive market to nationalization and back again in a liberalized market. Follow developments in the Indian insurance sector reveals a 360-degree turn over witness for almost two centuries.
An important milestone in the life insurance business in India
1912: The Indian life insurance companies which are legally, as a first statutes to regulate the life insurance business.
1928: the Indian Insurance Companies Act brought order to the government to collect statistical information on both the life and non-life insurance businesses.
1938: Earlier legislation consolidated and amended the Insurance Act with the aim of protecting the interests of the insurer.
1956: 245 Indian and foreign insurance companies and the central government took over and nationalized. created by Act of Parliament- LIC LIC Act of 1956 capital contribution of Rs. 5 crore to Government of India.
a tough battle to expand the market share of private sector life insurance industry, which is providing 14 life insurance companies, 26% have lost 3% market share in the state-owned Life Insurance Corporation (LIC) in the domestic life insurance industry in 2006-07. According to data published Insurance Regulatory and Development Authority, the total fee for the 14 companies shot up 90% Rs 19,471.83 crore in 2006-07 Rs 10, 252 crore.
LIC premium to mobilize a total of Rs 55 934 crore has been able to maintain its market share of 74.26% during the reporting period. Overall, the life insurance industry in the first year premium grew 110% over Rs 75, 406 crore in 2006-07. The 2006-07 performance threw a few surprises in the ranking of private sector life insurance companies. New entrants such as Reliance Life and SBI Life has shown tremendous growth over 381% and 210% during the year. Reliance Life, which became one of the top five companies in the premium of Rs 930 crore during the year of the year.
Although ICICI Prudential Life Insurance has remained as the No 1 private sector life insurance company Bajaj Allianz has overtaken ICICI Prudential Monthly terms of market share during the year in March, for the first time. Private operators are not one-time fee Bajaj's market share in March was 29.1% vs. ICICI Prudential 23.8%. Bajaj gained 4.6 percentage points of market share in the distribution of the private sector in FY07.
among private players, SBI Life and Reliance Life is still good, everything is becoming a 4% market share in FY07. SBI Life ascendance growing contribution of ULIP premiums. Another notable development in the 2006-07 performance has been the expansion of the retail markets for life insurance companies. Bajaj Life Insurance Alliannz has added 20 lakh policies while ICICI Prudential has expanded over 19 lakh policies during the year.
possibility
– a state monopoly little incentive or a wide range of innovative products. It can be seen the lack of categorization of individual products portfolio of LIC and GIC is not a more robust risk products, such as health insurance. More competition in this business incentive for companies to offer several new products and more complex and detailed risk rating.
– This may also result in better customer service and improve the variety and the price of insurance products.
– the entry of new actors to accelerate the spread of both life and general insurance. Measure the spread of insurance penetration and insurance density measure.
– The entry of private institutions, it is expected that the insurance business year roughly 400 billion rupees, more than 20 percent year even if we disregard the relatively underdeveloped sectors of health insurance, pen More importantly, it also provides a great mobalisation the funds can be used for the purpose of infrastructure development, which is a factor taken into globalization insurance.
– more importantly, it also provides a great moblisation the funds can be used for the purpose of infrastructure development, which is a factor taken into globalization insurance.
– it allows the economic interests of foreign companies either itself or its subsidiary or candidates not exceeding 26% of paid-up capital of Indian partners will be operated on as a result of supplementing domestic savings and increasing economic development in the nation. Agreements with various companies has been discussed later in this paper.
– It is estimated that the growth of the insurance sector for more than three times the growth of the economy in India. Thus, business or domestic companies try to invest in the insurance sector. In fact, the growth of the insurance business in India is 13 times the growth of insurance in developed countries. So it is natural that foreign companies will cultivate a very strong desire to invest something in the insurance business in India.
– the most important in the least will create huge employment opportunities in the field of insurance, which is a pressing problem in today's contemporary issues. BEFORE
INDUSTRY CHALLENGES
when new companies started business discussed earlier. Some of these companies have been able to float 3 or 4 products only to achieve a target level of 8 or 10 products. Currently, these companies are not in a position to pose a challenge LIC and all the other four companies operating in the general insurance sector, but if we see the quality and standards of products they issue, it is undoubtedly a challenge for the future. Because of these challenges throughout the environment caused by the challenges of globalization and liberalization of the sector before.
– The current insurer, LIC and GIC, we have created a large group of dissatisfied customers due to the poor quality of service. So there will be no change in the number of large customers LIC and GIC private insurers.
– a large number of LIC policies against the transfer problem, the new insurers to woo them to offer innovative products at lower prices.
– for corporate customers and payments systems group savings schemes may shift their allegiance LIC private insurers.
– there is a probability of exit dynamic young executives in the private insurer LIC, as will be higher than the pay package.
– LIC is overstaffing and the introduction of full computerization of many employees will be redundant. However, they can not be closed ,. Thus, the operating costs can not be reduced LIC. It will be a disadvantage in the competition, as the new insurers will work in small offices and high technology reduce operating costs.
– GIC and four subsidiary companies will face more challenges because the administrative costs are very high due to additional staff. Not because they can reduce their number of service rules.
– Manage your debts strain on the financial resources, GIC and its subsidiaries because it does not meet the mark.
– LIC products and GLC over 60, more than 180 products in its kitty, which has become obsolete in the present context, because they are not suited to the changing needs of customers. Not only that, it is not competent enough to complete the new products offered by foreign companies in the market.
– Reaching the consumer expectations on par with foreign firms such as improved yield and better quality of service, particularly in the area of claims management, issue of the new policy, transfer policy and revival of the policy of a liberalized market is very difficult to LIC and GIC.
– Strong competition for new insurance for consumers gain more -Distribution channels, including agents, corporate agents, bank branches, affinity groups and direct marketing through telesales and interest.
– The market very soon flooded with a large number of products rather large number of insurers operating in the Indian market. Even a limited range of products offered by LIC and GIC, consumers confuse the market. The confusion continued to increase in the face large number of products on the market. The current level of consumer awareness of insurance products is very low. This is so because only 62% of the Indian population is literate, and less than 10% are trained. Even educated consumers are not familiar with a variety of insurance products.
– Insurers face a serious problem for redressal of grievances of consumers' lack of products and services.
– increasing awareness will be completed by a number of legal cases, consumers, insurers are expected to increase substantially in the future.
– Major challenges canalizing the growth of the insurance sector, product innovation, distribution network, investment management, support and education.
Essentials challenges
– Indian insurance industry to the next, to meet the global challenges
– understanding the customer better enable determination of products of insurance companies designing appropriate prices correctly and increase profitability.
– Selection of the right type of sales channel mix together with prudent and effective management of FOS [Fleet On Street].
– an effective CRM system that is ultimately sustainable competitive advantages and build a long term relationship
– or the insurance companies follow the best investment practices and should be a strong asset management companies to maximize their returns.
– insurers need to increase the customer base, semi-urban and rural areas, which offer huge potential.
– Promoting health insurance and e-brokerage business increased.
CONCLUSION
This is the last one based on the above discussion we can conclude that there is a need to increase justified by the private sector entries operational efficiency, higher density and insurance coverage in the country and greater mobilization of long-term savings, long-gestation infrastructure projects. In the wake of such competition it is essential that government monopolies (LIC and GIC) to quickly add or existing technology, transforming themselves more efficient business lines and operate in a wide. New players should not be treated as a rivalry in government companies but also their objective to complement the growth of the insurance business in India.
* Associate Professor, Department of Commerce, Bharathiar University, Coimbatore-46
e-mail – buarticlecommerce@yahoo.com
** Ph.D Scholar, Department of Commerce, Bharathiar University, Coimbatore. E-mail – parentbala@sify.com