The entry of new players into the Indian insurance market is needed so that every citizen has insurance cover, according to Mr Debasish Panda, IRDAI chairman.
In a speech on 21 February at the Indian Venture and Alternate Capital Association (IVCA) conclave, he said that while India’s insurance sector has greatly matured since it was opened up 20 years ago, the emerging needs of various sections of the population have made it amply clear that the existing 70-odd players cannot fulfill all of them, according to a report in Business Standard.
IRDAI has committed to achieving “Insurance for All” by 2047, whereby every citizen would have appropriate life, health and property covers, and every enterprise would be supported by appropriate insurance solutions.
Mr Panda said, “We are a diverse nation and cannot have a one-size-fits-all strategy. We need strategies for different geographies, different sections of society, different lifestyles and income levels, and different needs. All this will require unique insurance solutions.”
“Hence, we need more players and we need differentiated players who can reach out to every citizen in every nook and corner of the country. We need more products to provide choices to consumers. The distribution model also needs to be expanded and it has to be tech-based. So, we need more players, more products, more distribution partners, more technology, and more integration”.
According to the regulator, 19 applications for insurance licences are being processed at the moment.
Pointing to the Indian market’s huge potential, Mr Panda said, All it needs is the right kind of approach, support, and an enabling infrastructure and ecosystem.”
He said that the insurance industry would need a capital infusion of INR500bn ($6bn) every year to double its penetration over the next 5-7 years.
Speaking about the proposed amendments to the Insurance Act, Mr Panda said, “The proposed amendments to the Insurance Act aim to create a more robust, facilitative, and supportive insurance landscape. With these amendments, we could probably see new players in the form of micro, captive, regional, special, composite insurers catering to the different needs of the geography.”
