Essay about Growth of Insurance Industry Post Liberalisation
The journey of insurance liberalization process in India is now several years old. The first major milestone in this journey has been the passing of Insurance Regulatory and Development Authority Act, 1999. This along with amendments to the Insurance Act 1983, LIC and GIC Acts paves the way for the entry of private players and possibly the privatization of the hitherto public monopolies LIC and GIC. Opening up of insurance to private sector including foreign participation has resulted into various opportunities and challenges.
CONCEPT OF INSURANCE :
In our daily life, whenever there is uncertainly there is an involvement of risk. The instinct of security against …show more content…
• Limited number of private companies to be allowed in the sector. But no firm is allowed in the sector. But no firm is allowed to operate in both lines of insurance (life or non-life).
• Tariff Advisory Committee (TAC) is delinked form GIC to function as a separate statuary body under necessary supervision by the insurance regulatory authority.
•All insurance companies be treated on equal footing and governed by the provisions of insurance Act. No special dispensation is given to government companies.
•Setting up of a strong and effective regulatory body with independent source for financing before allowing private companies into sector.
COMPETITION TO GOVERNMENT SECTOR:
Government companies have now to face competition to private sector insurance companies not only in issuing various range of insurance products but also in various aspects in terms of customer service, channels of distribution, effective techniques of selling the products etc. privatization of the insurance sector has opened the doors to innovations in the way business can be transacted.
New age insurance companies are embarking on new concepts and more cost effective way of transacting business. The idea is clear to cater to the maximum business at the lest cost. And slowly with time, the age-old norm prevalent with government companies to