Debasish Panda,chairman, IRDAI
“There are huge opportunities but we are not able to tap it specifically in the context of agricultural, disaster management and cyber insurance,” said Debasish Panda,chairman, IRDAI
Mumbai:
Debasish Panda, chairman, IRDAI has said the insurance regulations have shifted from rule based to principle based and has facilitated ease of raising capital to maintain the solvency along with ensuring flexibility in business operations.
“Insurtech startups are being mainstreamed through sandbox methods and there has been a focus on cost of intermediation, product choices to customers by shifting towards use and file,” said Panda while addressing the 18th Insurance Summit on “Broadening the Horizon – Navigating towards a fully Insured India”, organized by Pune based National Insurance Academy(NIA) on Monday in Mumbai
IRDAI is also working on Bima Sugam- a one stop shop for insurance, he said.
“Among other things, IRDAI is developing a women centric force of Bima Vahak, preparing the industry for IFRS and promoting other missions to focus on the three A’s of insurance- awareness, accessibility and affordability,’’ he added.
Another area of focus should be product simplification and innovation. Tech based coverages, region based coverages have to be looked into because one size fits all is no longer applicable, he said.
One of the major challenges he addressed was to find ways to take care of out of pocket expenses which is still around 60 per cent.
“There are huge opportunities but we are not able to tap it specifically in the context of agricultural, disaster management and cyber insurance,” he said.
He said that the industry has been growing at 11 per cent CAGR for the last five years but to insure every person in India he highlighted that importance of insurance as financial and social protection has to be worked upon.
Economy with a growth of 7 percent now is showing great resilience against pandemic downturn and such a growth momentum is expected to remain constant which is a golden opportunity for the insurance sector to improve its global ranking from 10th to 6th largest.
Saying that the Indian insurance industry today has bounced back from the issues which arose during the lockdown period M.R. Kumar, chairperson, Life Insurance Corporation (LIC) said that even today only 3 in every 100 people in the country have a life insurance policy.
Even though penetration increased during the COVID-19 pandemic, it still is very low and needs to be worked upon by industry leaders, he said.
In 2021, India also witnessed the highest growth in high net-worth Individuals. This led to a huge increase in the consumer’s appetite for better and more customised insurance products.
He said that the Pensions and Annuities are one of the most important components of the life insurance market.
Swiss Re estimates show great growth and appreciation in this domain of Pensions and annuities.
Investing in these products will benefit the industry immensely,he said.
He focused that consumers today want more customised and easy-to-use products and they are also ready and willing to pay the premiums accordingly.
AI, ML and blockchain are some of the new words which are constantly being used in this domain.
Devesh Srivastava, chairman-cum-managing director, GIC Re, in his special address mentioned that India is rising steadily to become a global power which presents us with an opportunity and responsibilities.
He mentioned that the vehicle ownership pattern is changing post-covid-19 which would significantly impact the motor insurance market.
“We might be going towards a future where driverless cars would be a reality. Covid tailwinds have impacted the awareness of consumers in India. Health insurance numbers are growing significantly in retail lines,’’ he said.
He said that the distribution model is rapidly changing and the share of web aggregators is rapidly growing.
Saurabh Mishra, joint secretary, department of financial services (DFS) ,Ministry of Finance, in his special address spoke about accessibility and affordability of insurance.
He mentioned Pradhan Mantri Jeevan Jyoti Bima Yojana, Pradhan Mantri Suraksha Bima Yojana and Pradhan Mantri Jan Arogya Yojana have hit the 70 cr mark.
He also focused on the need to simplify the insurance industry from the huge English jargons.
“Insurers will have to create simplicity for the public while using insurance-related products and mechanisms. These are a few things that can help us jump-start the penetration. Some of the unexplored areas include agriculture insurance and cyber insurance which will boom with the help of newer technologies in the near future,” he said.
G. Srinivasan, director, NIA said that the changing risk dynamics including pandemics and climate change poses innumerable challenges as well as opportunities to the insurers to move beyond the current level of penetration and develop strategies to ensure a fully insured India.
He also talked about the important role played by NIA in developing insurance talent through its skilling and re-skilling of insurance professionals and the two-year PGDM programme.