India is currently set on an upward growth trajectory and the recent developments in the insurance sector have contributed to that heavily. Apart from the favorable economic conditions, the biggest reason behind the boom of the insurance industry is the various initiatives the government has taken to improve the economy and the performance of the insurance sector.
Here are five developments in the life insurance industry that are significant:
Growth in premium
INR 4.58 lakh crore was collected as premiums in the financial year 2017-18. This has been one of the most noteworthy developments in the industry. This is a considerable rise as compared to the premium collection of INR 4.18 lakh in the financial year 2016-17. This is an indication that the people of India are now more open to buying life insurance plans. In a populated country like, one needs insurance plans with variety and flexibility, and the insurance companies have been able to offer that.
Outstanding claim settlement ratio
The recent growth clearly shows that people are following the life insurance trends, which means that the buyers are now more involved. This surely has increased the importance of claim settlement ratio as it helps people to choose the right insurers. The performance of the Indian private sector life insurance companies regarding the claim settlement ratio has been exceptional. When 12 of them ended the year with a settlement ratio of over 95%, seven of the companies ended up with a ratio between 91-95%.
Better fraud management practices
The insurance industry trends regarding the high claim settlement ratio indicate that the insurance companies have performed better in terms of fraud management practices. The recent development in technology has allowed the insurance companies to maintain and analyze the Know-Your-Customer (KYC) information better. This has helped them to recognize fraudulent practices even before issuing an insurance policy.
The increased use of technology has worked as a blessing for the life insurance industry. The government’s push towards cashless transactions has made it possible for the insurance companies to implement digital issuing of policies and settling claims. Innovations such as machine learning, data analysis, blockchain, and other technological developments have made the insurance industry a more effective sector.
The online insurance industry is another aspect of development that is helping life insurance companies to reach more customers. With the help of websites and apps, people can now reach their insurers easily and from anywhere. Moreover, conducting the insurance business online is proving to save more time. Life insurance companies can now serve and help their customers faster.
With the digitalization of the insurance sector, the life insurance policy providers can now their customers better. Any insurance company that understands the importance of technology in customer service will surely be able to capture the bigger portion of the industry. This is something that helps both the insurer and the insured, and the future of the insurance business seems bright.