India's Finance Minister Nirmala Sitharaman on Monday, in her Union Budget speech, announced a proposal to increase the foreign direct investment (FDI) limit in the insurance sector to 74 per cent. Sitharaman said the Insurance Act 1938 will be amended to "increase permissible FDI limit from 49 per cent to 74 per cent in insurance companies and allow foreign ownership and control with safeguards".
2020 witnessed various announcements and regulatory changes in the insurance sector due to the on-going Covid pandemic. We believe that the need for Insurance coverage is critical in these times and should be a very important consideration in budget 2021.
The structure of the market has substantial implications for the long term trajectory of the health system. The individuals also under-estimate health risks and may, therefore, not purchase adequate health insurance, revealed Economic Survey 2020-21.
India’s insurance penetration, which was at 2.71% in 2001, has steadily increased to 3.76% in 2019, but stayed much below the global average of 7.23%, stated the Economic Survey for 2020-21 released on Friday. The survey also highlighted that the penetration in India was particularly low for the non-life segment.
The Union budget 2021 is one of the most crucial budgets, as the government will focus on bringing the economy back to track. While India has been able to manage the Covid pandemic crisis and the economy is beginning to display budding confidence, the budget this year is vital for all sectors.
The ongoing COVID-19 pandemic has resulted in heightened awareness about the effectiveness of insurance against health or life crisis. With the 2021 union budget fast approaching, the insurance industry is hoping that the government would provide further impetus to deepen the penetration of insurance in the country considering its role as the social security tool.
Balachander Sekhar, a student of IIT Mumbai and IIM Calcutta, worked in the FMCG, banking and insurance sector for over 20 years. He was the CMO of PNB MetLife and the CEO of Reliance Retail Insurance as well as the head of ABN AMRO Group. Then he decided to start his own venture in the year 2015 and laid the foundation for 'RenewBuy'. So far, the company has raised funds of about Rs 200 crore, so that they will upgrade the technology and hire the marketing and talent of the product.
With demand for insurance shooting up after the covid-19 pandemic broke out, bite-sized plans are gradually gaining popularity (read). Last month, WhatsApp said it may start offering micro-insurance products from SBI General Insurance Co. Ltd on its platform soon; no further information has been released about it as yet.
Insurance is one sector in India that has a huge latent need but there is a lack of awareness and accessibility. There are around 700 million customers who have the need for insurance but want in accessibility.
2020 saw many businesses not only pivoting online, but also thriving and insurance is one such sector. To be sure, online claim processing or assessment, customer acquisition, instant policy as well as immediate renewals — are part of how the insurance sector functions. “There was almost a 50-60% increase in health and life insurance queries.