Growth and Performance of General Insurance Sector in India

Abstract: Life is full of risks and uncertainties. In fact risk is everywhere. One must protect himself or herself from this risk. The solution is insurance. Broadly it is of two types, i.e., life insurance and non-life insurance (general insurance). In this paper we discuss about only general insurance. From the post liberalization scenario, general insurance in India is growing rapidly. The reasons behind its spectacular growth are allowing private companies to enter into Indian market, low insurance premium, TPAs (Third Party Administrators), fast and immediate settlement of insurance claims, innovative general insurance policies, discounts in insurance products, increasing awareness among people, more distribution channels, etc. The other side of the coin is that public sector insurance companies are facing cut throat competition from private insurance companies as they offer wide variety of policies at a low premium. Due to this few general insurance companies are closed and few are forced to come out with same polices and services. Ultimately the performance of public sector general insurance companies is also enhanced with the competitive moves by private players. General insurance companies under public sector are facing lot of challenges from private players and to withstand the competition, they have improved a lot in their quality of service in multiple facets like decreasing the premium, quick settlement of claims, etc. In a nutshell, general insurance business is contributing significantly to Gross Domestic Product (GDP) in India. Keywords: IRDA, General Insurance, Risks, Public and Private Sector General Insurance Companie