The journey of the insurance freedom process in India is now over seven years old. The first milestone in the journey was the passing of the Insolvency and Development Insurance Act, 1999. This and the amendments to the Insurance Act of 1983, the LIC and the GIC Rules open the way for private players to enter and possibly own ownership until now. GIC. The opening up of insurance to private companies involving foreign participation has led to various opportunities and challenges.
The Insurance Concept
In our daily lives, whenever there is uncertainty there is risk involvement. The instinct for protection from such dangers is one of the basic motivating forces in determining human attitudes. As a result of this security demand, the concept of insurance should have been born. The desire to provide insurance or protection against loss of life and property must encourage people to volunteer for collective security. In that sense, the issue of insurance may be as old as mankind’s.
Life insurance in particular provides home protection against the risk of premature death of the earning member. Modern life insurance also provides protection against other health-related risks such as longevity (e.g. risk of loss of income) and risk of disability and illness (health insurance). Products that provide longevity are pensions and pensions (old age insurance). Non-life insurance offers protection against accidents, property damage, theft and other debts. Non-life insurance contracts are usually shorter in time compared to life insurance contracts. The combination of risk integration and preservation is a form of life insurance. Life insurance provides protection and investment.
Insurance is useful for business concerns. Insurance provides short-term assistance and long-term assistance. The temporary release aims to protect insurers from loss of property and health by spreading losses among a large number of people by using risk workers as insurance providers. It makes the entrepreneur suffer an unexpected loss, therefore, he does not have to worry about possible losses. The long-term growth of the country’s economy and industry by making large investments available to insurers in the formal and commercial industry.
Prior to the nationalization of the insurance industry in 1973 the GIC Act was passed in Parliament in 1971, but came into effect in 1973. There were 107 insurance companies comprising branches of foreign companies operating in the country of nationalization, these companies were merged and consolidated into the next four GIC subsidiaries such as National Insurance Co.Ltd., Calcutta; New India Assurance Co. Ltd., Mumbai; Oriental Insurance Co Ltd., New Delhi and United India Insurance Co Ltd., Chennai and Now delinked.
The general insurance business in India is broadly divided into GIC fire, maritime and other alternatives without directly managing the Aviation and Reinsurance business which owns the Comprehensive Crop Insurance Scheme, Personal Accident Insurance Scheme etc. GIC and its subsidiaries in line with the purpose of nationalization spread the message of insurance far and wide and provide insurance protection to the vulnerable part of the community in an effort to build new covers and expand other informal businesses.
Complete control of the insurance business in India came into operation through the enactment of the Insurance Act, 1983. He tried to build a strong and powerful regulatory authority for the Insurance Regulator with the power to direct, advise, investigate, register and dissolve insurance companies etc. However, due to the inclusion of insurance businesses under the government, many regulatory functions were taken over by the Insurance Regulator and handed over to the insurers themselves.
The Impact of Freedom
While national insurance companies have done a commendable job in increasing the volume of the opening of the insurance industry business for private players it was a necessity in the context of financial sector freedom. If traditional infrastructure and social industries such as banking, aviation, telecommunications, energy etc. Its impact should be reflected in the way it creates opportunities and challenges.
1. Personalization if the Insurance is canceled by the independent business of Life Insurance Corporation of India. It can help to cover a wide range of risks in general and life insurance. It helps to introduce a new range of products.
2. It can also lead to better customer service and help to improve the types and prices of insurance products.
3. The entry of a new player will accelerate the spread of general life insurance. It will increase insurance coverage and energy rating.
4. The entry of private players will ensure the collection of funds that can be used for infrastructure development.
5. Allowing commercial banks into the insurance business will help to consolidate funds from rural areas due to the availability of major bank branches.
6. Most importantly not too few job opportunities will be created in the insurance sector which is a burning issue for today’s issues.