Global Journal of Commerce & Management Perspective
Open Access

Abstract

Life Insurance Industry in India - An Overview

Dr.D.Rajasekar and T.Hymavathi Kumari

At present Indian insurance is a flourishing industry, with several national and international players. The insurance sector was opened up for private participation on the ground that in spite of enormous contributions made by the public sector to expand the coverage and spread awareness about insurance, the interests of the consumers would be better served. A new era began in the Indian insurance sector, with the passing of the Life Insurance Act of 1912. Life Insurance is the fastest growing sector in India, since 2000 as Government allowed Private players and FDI up to 26 per cent. Life Insurance in India was nationalized by incorporating Life Insurance Corporation (LIC) in 1956. In 1993 the Government of India appointed RN Malhotra Committee to lay down a road map for privatization of the life insurance sector. After that the IRDA bill in parliament was passed in Dec.’99. As per the provisions of IRDA Act, 1999, the Insurance Regulatory and Development Authority was established on 19th April, 2000 to protect the interests of policyholders and to regulate, promote and ensure orderly growth of the insurance industry. In-spite of this significant status of insurance sector in India, nearly 80 percent of population is without life insurance cover, health insurance and non-life insurance. In other words, insurance coverage is far below the international standards. However, there is an immense growth potential for insurance sector in India. Further, it indicates that there is a huge potential for insurance business in the country. At this juncture, it is required to evaluate the performance of life insurance industry in India. The present study is mainly aimed to investigate the operational, financial and managerial performance for a period of ten years i.e. from 2001-02 to 2010-11.