ns ran e in ndia        13.7
               funded health insurance schemes are 13.1                   company Aviva Life Insurance (in
               per cent in rural areas and 12 per cent in                 partnership with MFIs) which has forged
               urban areas (Economic Survey 2015–16).                     alliances with banks like Canara Bank,
       (iii) After the general insurance industry was                     P&SB, RRBs, 23 cooperatives, etc., to
               opened up (2000) for the private sector                    promote micro finance.
               participation, the experience has been                         Micro insurance has evolved in the past
               positive.12 Its growth compares favourably                 two decades of research in micro finance
               with that of many other emerging markets                   and has seen growth in countries like Sri
               and is in line with global benchmark of                    Lanka, Philippines in the last decade.16
               two to three times the growth in GDP.13                    Here NGOs and people’s organisations
               As the economy is on a strong growth                       are allowed to register themselves as
               path and the capital expenditure planned                   micro insurance companies which sell
               across industries is estimated to be over                  such insurance. As they cover the risk
               Rs. 9,00,000 crore over the next four to                   themselves, they are allowed to reinsure
               five years, a better scope for the general                 with one of the large global companies
               insurance expansion is probable.14 The                     like Swiss Re or Munich Re. Same model
               growth in both commercial and personal                     is suggested for India but for this to
               lines of general insurance business reflects               happen drastic changes in the existing
               positive trends. Over 70 per cent of India’s               insurance rules are required.17
               population lives in rural areas and along            (v) Many of the experts believe that insurance
               with organised financial services, general                 industry should benefit the insurers,
               insurance companies are also expanding                     reinsurers as well as the insured. The
               into these sectors.                                        social purpose of the insurance sector is
       (iv) People in their lives experience financial                    never praiseworthy to be marginalised by
               difficulties that can affect the entire                    the corporate interests (be domestic or
               family negatively, this is more true about                 foreign)—at least it does never taste good
               the poor masses in India.                                  in India which needs a strong social safety
                  This is why experts suggested for the                   net.18
               provision of micro insurance. A relatively          (vi) Almost all of the private insurance
               new concept, micro insurance is today                      companies in India have been demanding
               provided to the beneficiaries of micro                     that the government-owned insurance
               finance covering the finance amount,                       companies (i.e., LIC and the four
               reducing the risk of the clients as well as                general insurance companies) should be
               the micro-finance institutions (MFIs).15                   converted into private sector companies.
                  The concept of micro insurance has                      Their reasons are logical as in comparison
               been developed by the private insurance            16.  Ibid.
                                                                  17.  It has been beautifully shown taking example of the
      12.   Sandeep Bakhshi, CEO & MD, ICICI Lombard General
                                                                       Self-employed Women’s Association (SEWA) by
            Insurance Company, Mumbai, Survey of Indian
                                                                       Renana Jhabvala and Ravi Kanbur in the Kaushik Basu
            Industry 2007, The Hindu, p. 99.
                                                                       (ed.) India’s Emerging Economy, (New Delhi: Oxford
      13.   Ibid.                                                      University Press, 2005), pp. 309–110.
      14.   Ibid.                                                 18.  Biplab Dasgupta, Globalisation: India’s Adjustment
      15.   Vivek Khanna, Director, Aviva India, Survey of Indian      Experience, (New Delhi: Sage Publications, 2005),
            Industry 2007, The Hindu, p. 102.                          pp. 221–31.