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13.8 ndian onom with the government-owned insurance US$ 323.4 and US$ 337.1 respectively—while companies, private companies are global average was US$ 638.3 (US$ 353 for Life always ready with highly attractive and US$ 285.3 for Non-Life). and lucrative insurance schemes, but As per the area experts and the insurance they have not been able to attract the regulator, there are several factors responsible for clients for them. Therefore, the private the low insurance penetration in the country— insurance companies have been fetching major ones of them are as given below: huge operational losses due to lack of the (i) Complex and delayed claim settlement desired level of their expansion and the procedures; overhead expenditure.19 (ii) Vague and incomprehensible rules and regulations of the insurance companies; insurance penetration (iii) Lack of education and awareness among The growth in the insurance sector is internationally the masses; measured based on the standard of insurance (iv) Lower income levels of the population; penetration. Insurance penetration is defined as (v) Socio-cultural factors; the ratio of premium underwritten in a given year (vi) Lack of level playing field in the industry; to the Gross Domestic Product (GDP). Likewise, and insurance density is another well recognised (vii) Less vibrancy in the regulatory framework. benchmark and is defined as the ratio of premium underwritten in a given year to total population Recently enacted Insurance Laws (measured in US dollars for convenience of (Amendment) Act, 2015 is supposed to have comparison). The Indian insurance business has positive impact on regulatory framework as well in the past remained under-developed with low as insurance penetration. levels of insurance penetration. Policy initiAtives In 2016 (latest)20, insurance penetration in India was 3.49 per cent (was 2.71 per cent in Committed to expand and strengthen, the 2001)—2.72 per cent for Life and 0.77 per cent insurance industry in the country (following the for Non-Life segments respectively. Insurance recommendations of the Malhotra Committee Penetration in some of the emerging economies Report, 1993), the Government of India has taken in Asia, i.e., Malaysia, Thailand and China during the following policy initiatives21 in recent years: the same year were 4.77 per cent, 5.42 and 4.15 (i) Health Insurance: The Insurance per cent respectively—while at global level it was Regulatory Development Authority 3.47 per cent. (IRDA) has been taking a number of The insurance density (in 2016) in India was proactive steps as part of the initiatives US$ 59.7 (was US$ 11.5 in 2001)—US$ 46.5 for for the spread of health insurance. It Life and US$ 13.2 for Non-Life segments. The had set up a National Health Insurance comparative figures for Malaysia, Thailand and Working Group in 2003, which provided China during the same period were US $452.2, a platform for the various stakeholders in the health insurance industry to 19. G. V. Rao, CMD, Oriental Insurance Co. Ltd., Survey work together and suggest solutions of Indian Industry 2007, The Hindu, pp. 87–90. 20. Economic Survey 2017-18, Vol. 2, Ministry of Finance, 21. Ministry of Finance, Economic Survey 2011–12, (New GoI, N. Delhi, p. 55. Delhi: Government of India, 2012), pp. 128–29.