INTRODUCTION TO GENERAL INSURANCE
Insurance industry has always been a growth-oriented industry globally. On the Indian scene too, the Insurance industry has always recorded noticeable growth vis-à-vis other Indian industries.
Triton Insurance Co. Ltd. was the first General Insurance Company to be established in India in 1850, whose shares were mainly held by the British. The first General Insurance Company to be set up by an Indian was Indian Mercantile Insurance Co. Ltd., which was established in 1907.
The General Insurance business was nationalised after the promulgation of General Insurance Business (Nationalization) Act, 1972. The post-nationalisation General Insurance business was undertaken by the General Insurance Corporation of India (GIC) and its 4 subsidiaries:
1. Oriental Insurance Company Limited;
2. New India Assurance Company Limited;
3. National Insurance Company Limited; and
4. United India Insurance Company Limited.
Towards the end of 2000, the relation ceased to exist and the four companies are, at present, operating as independent companies.
The Life Insurance Corporation (LIC) was established on 01.09.1956 and had been the sole corporation to write the life Insurance business in India.
The Indian Insurance industry saw a new sun when the Insurance Regulatory & Development Authority (IRDA) invited the applications for registration as insurers in August, 2000. With the liberalisation and opening up of the sector to private players, the industry has presented promising prospects for the coming future.
The Indian Insurance industry is featured by the attributes:
• Low market penetration;
• Ever-growing middle class component in population.
• Growth of consumer movement with an increasing demand for better Insurance products;
• Inadequate application of information technology for business.
• Adequate fillip from the Government in the form of tax incentives to the insured, etc.
The industry formations need to keep vigil on these characteristics of the Indian market and formulate their strategies to entail maximum contribution to the output of the sector.
The Indian life and non-life Insurance business accounted for merely 0.42 percent of the world's life and non-life business in 1997.The figures of the basic parameters of the industry's performance viz. Insurance Density and Insurance Penetration also are evident of the hitherto existing low-yield Indian market conditions.
The term "Insurance Penetration" broadly measures the contribution of the Insurance industry in relation to a nation's entire economic productivity. The figure of premium vis-à-vis the GDP of 1999 stood at 0.54 percent for non-life Insurance business and 1.39 percent for the life Insurance business.
The term "Insurance Density" reflects the Insurance purchasing power. The premium per capita in India amounted to US $ 2.40 for non-life Insurance and US $ 6.10 for life Insurance in 1999 but with the deregulation of the sector, a sea-change in the scene is most likely.
Insurance industry has always been a growth-oriented industry globally. On the Indian scene too, the Insurance industry has always recorded noticeable growth vis-à-vis other Indian industries.
Triton Insurance Co. Ltd. was the first General Insurance Company to be established in India in 1850, whose shares were mainly held by the British. The first General Insurance Company to be set up by an Indian was Indian Mercantile Insurance Co. Ltd., which was established in 1907.
The General Insurance business was nationalised after the promulgation of General Insurance Business (Nationalization) Act, 1972. The post-nationalisation General Insurance business was undertaken by the General Insurance Corporation of India (GIC) and its 4 subsidiaries:
1. Oriental Insurance Company Limited;
2. New India Assurance Company Limited;
3. National Insurance Company Limited; and
4. United India Insurance Company Limited.
Towards the end of 2000, the relation ceased to exist and the four companies are, at present, operating as independent companies.
The Life Insurance Corporation (LIC) was established on 01.09.1956 and had been the sole corporation to write the life Insurance business in India.
The Indian Insurance industry saw a new sun when the Insurance Regulatory & Development Authority (IRDA) invited the applications for registration as insurers in August, 2000. With the liberalisation and opening up of the sector to private players, the industry has presented promising prospects for the coming future.
The Indian Insurance industry is featured by the attributes:
• Low market penetration;
• Ever-growing middle class component in population.
• Growth of consumer movement with an increasing demand for better Insurance products;
• Inadequate application of information technology for business.
• Adequate fillip from the Government in the form of tax incentives to the insured, etc.
The industry formations need to keep vigil on these characteristics of the Indian market and formulate their strategies to entail maximum contribution to the output of the sector.
The Indian life and non-life Insurance business accounted for merely 0.42 percent of the world's life and non-life business in 1997.The figures of the basic parameters of the industry's performance viz. Insurance Density and Insurance Penetration also are evident of the hitherto existing low-yield Indian market conditions.
The term "Insurance Penetration" broadly measures the contribution of the Insurance industry in relation to a nation's entire economic productivity. The figure of premium vis-à-vis the GDP of 1999 stood at 0.54 percent for non-life Insurance business and 1.39 percent for the life Insurance business.
The term "Insurance Density" reflects the Insurance purchasing power. The premium per capita in India amounted to US $ 2.40 for non-life Insurance and US $ 6.10 for life Insurance in 1999 but with the deregulation of the sector, a sea-change in the scene is most likely.