India considers modifying regulations to help the $731 billion insurance industry

16 Jun 2023 , 10:58 AM

As more foreign businesses queue up to enter the sector, India is considering changing the rules to increase insurance penetration in the nation. The move could lead to better services for customers along with increasing their options.

‘Proposals for amendments to insurance laws include rationalized capital requirements, composite registration, one-time registration for intermediaries, value-added services by insurers, and sale of other financial products,’ said Debasish Panda, chairman of the Insurance Regulatory and Development Authority of India, in an email to Bloomberg.

Less than 5% of the 1.4 billion people in the nation have insurance coverage, which indicates growing possibilities for investors.

The nation permits foreign investors to own up to 74% of the shares of insurers. Through their local partners, international companies like American International Group Inc. and Prudential Financial Inc. already have a presence in India.

According to Panda who talked to Bloomberg, four new companies have just entered the country’s insurance market, and a few more are in various phases of enrolment, indicating a favourable business environment.

Indian insurance companies now have $731 billion in assets under control, which is more than the economies of numerous nations, including Poland and Sweden. In the year that ended in March, the sector expanded 13.7%.

According to Panda, the sector requires additional technical capabilities, expertise, technology, and capital. ‘The expanding middle class, young population, growing disposable incomes, and widespread usage of technology provide several prospects,’ Panda stated to Bloomberg.

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