Chapter 1 - The Indian Insurance Industry.
It was the 10th Prime Minister of India, P. V. Narasimha Rao and his then Finance Minister Dr. Manmohan Singh, who set into motion, Phase 1 of the privatisation of the Indian Insurance Industry. The government was forced to act on the ‘globalization of India’ due to the country being economically weak and was suspected to be on the verge of bankruptcy. After the privatisation of the banking sector was looked into, the government setup a committee led by Chairman R. N. Malhotra in 1993 to propose change and reforms to be made in the Insurance Industry. The findings and recommendations of the committee in 1994 eventually led to the formation of the Indian Insurance regulator, the minor yet …show more content…
Although not conclusive, in 2005, 2009 and 2013, Dr. Singh Government, seemed to have expressed interest in bringing about the reforms on a few occasions. India in March this year, pushed through with Phase 2 of reforms.
The Insurance Laws (Amendment) Act 2015 now enacted, is widely expected to seamlessly remove archaic and redundant provisions in the legislations which existed till now and incorporate certain provisions to provide the IRDAI with the flexibility it requires to discharge its functions more effectively and efficiently. The relatively low 26% cap on foreign investment had been a widely discussed affair. The Amendment Act, now been enacted, introduces key changes to the Insurance Act, 1938, the General Insurance Business (Nationalization) Act, 1972 and the Insurance Regulatory and Development Authority (IRDA) Act, 1999. The major transformations include but are not limited to the following:
- Increasing the foreign investment cap to 49%.
- Permitting overseas reinsurers to open branch offices to carry out reinsurance business in India.
- Facilitating the entry of Lloyd 's of London, under regulations yet to be finalised.
As the first step to implement these changes, the Ministry of Finance introduced the Indian Insurance Companies (Foreign Investment) Rules 2015 (Rules) on 19 February 2015. The Rules require that approval from the Foreign Investment Promotion Board, Department of Economic Affairs, Ministry of Finance (FIPB) will
The insurance industry’s performance is highly correlated with the state of the economy and specifically GDP growth. From the data outlined in this report, it is evident that the insurance industry flourishes alongside the economy where factors such as output, unemployment, and other variables are growing as well. Since the 2008 crisis, the Canadian economy has recovered quite well. One of the key concerns going forward is the current exchange rate of the Canadian dollar. Going forward, as the economy goes into a boom it will be crucial for the insurance industry to reach its potential.
In the words of the erstwhile Finance Minister, Morarji Desai: Whereas Life Insurance Corporation will always bear in mind that its primary obligation is to its policy holders whose money it holds in trust, and will never lose sight of the fact that, as a single investor in India, it has to keep before it the investors of the community as a whole. It will, therefore, invest in ventures which further the social advancement of the country. Its funds will, as far as practicable, be invested for the entire good of the country. The following factors are essential for an ideal insurance policy:
With the introduction of this reformed market,more than 70% of people who were not a holder of insurance are now insured. It impact has largely been positive on insurance holders.
The Insurance industry is very heavily state regulated. According to the Government Accountability Office (GAO) study, the state run regulatory system is Federal verses State Regulation protecting the markets, insurance industry and policy holders and was evidenced during the financial crisis of 2008-09. The insurance business is highly profitable. “Well-run companies can make a lot of money, which breeds competition” from both “inside and outside competitors” (Property, 2013). Insurance companies were well “insulated” from the “severe” financial crisis of 2007-2008 that affected the banks and security firms, because the State regulations have the Insurance Industry “walled off” from Federal Regulations (Property, 2013). During the “Great Depression of the 1930s” “Insurance policy holders were protected by the states’ prudent supervision and regulation” (Property, 2013).
12-22-16 recd. a call from a lady who did not want to say who she was nor provide a call back #. She wanted to verify Mr. Pankopf's Liability Insurance. Once I provided his 2016 information since his 2017 was not entered as of yet she referred to the rule and claimed he did have insurance and did not report it to us and we should fine him. I explained she would need to speak to OBC because I do not handle complaints. I tried to transfer the call to Rose with no answer. I asked if she would like to leave a mesg for Rose she said no and asked who else she could talk to. I told her OBC is the only dept. She would need to call bk and she said she would. Told Vanessa so she was aware to send the call to OBC.
Many insurance firms are there in Australia, promising to execute the registration process in a short time, if the customers buy the insurance policy from them. These companies follow illegal ways, and charge ahefty amount of money. Avoid taking the assistance of such firms as they can bring you in serious complications. Consult a licenced agency, having a good
Submitted to Patty Delgado, Ysleta Senior Buyer Purchasing, two documents requested: Form 1295 (Texas Ethics Commission) and the certificate of insurance for the Ysleta ISD, Academic Resources-Part 2 #217031RFPB.
The challenge for the insurance companies nowadays is to provide the right type of policy to the customer as per the financial needs of customers. IDBI Federal is yet to prove its worth in the industry. Though IDBI Federal is able to sell the right policy to the right customer but the needs to boost up its advertisements to build a bond of mutual trust between the customers and the company. The products of IDBI Federal require additional features in it.
One of the most frustrating things about shopping for auto insurance is comparing quotes across different companies. After all, if you try to purchase the exact same coverage from two different carriers, you'd expect the price to be almost equal--much like buying a loaf of bread from two rival supermarkets. Why, then, can your quotes be so dramatically different from one company to another?
There have been a number of proposed and upcoming changes to GAAP and solvency reporting standards in the US, Canada and Europe in recent years. In particular, significant efforts have been made to increase convergence between US GAAP and IFRS. The following report discusses the pros and cons of convergence between standards in different jurisdictions, as well as convergence between GAAP and solvency standards, in relation to insurance contracts. Here, the term ‘GAAP’ refers to financial reporting for investors, shareholders and creditors. Solvency standards refer to the regulatory requirements imposed on insurers. The jurisdictions discussed have been limited to those in which The Greatest Life Insurance Company operates in: namely, the US, Canada and Europe.
Insurance is a federal subject in India. It is a subject matter of solicitation. The legislations that deal with insurance business in India are Insurance Act, 1938 and Insurance Regulatory & Development Authority Act (IRDA), 1999. Insurance is defined as is a form of risk management primarily used to hedge against unforeseen risks of contingent losses. Another approach to Insurance is as the equitable transfer of risks, or the possibility of occurrence of losses, from one entity to another, by the method of diversification in exchange for a premium. An Insurer is a company designing, promoting and selling insurance products and services amongst the public. An insured or policyholder is the person or entity purchasing these products and services.
Engineering Inspection & Insurance Co. (EIIC) is a small and medium-sized insurance Enterprise depended on its distinctive competence, machinery and boiler inspection service. EIIC was a highly successful company before 1990. However the economic environment changed progressively when EIIC reached its flourishing stage. These changes reformed the new development road for insurance industries and consequently generated enormous troubles to EIIC.