3 weeks ago
Parliamentary Panel Calls for Annual Insurance Penetration Targets in India
Insurance is like a promise from a company to help you pay if something bad happens, like a car accident or sickness.
In India, not many people have this protection.
A group of government helpers called a Parliamentary Committee looked at this problem.
They found that India's insurance protection is less than half the world's average.
The Committee told two government offices to make a plan with yearly goals.
The plan would help more families, farmers, and small businesses get insurance.
They also found three government insurance companies that are in financial trouble.
The Committee said the government must fix these companies and check on them every three months.
They also want insurance to cost less and hospitals to have set prices.
The big goal is called 'Insurance for All by 2047,' meaning everyone in India should have insurance by that year.
The Committee on Public Undertakings has recommended that the Department of Financial Services (DFS) and IRDAI set specific, time-bound annual insurance penetration targets with publicly disclosed milestones.
India's insurance penetration stands at 3.7% of GDP, nearly half the global average of 7%, with insurance density of USD 95 per capita versus the global average of USD 889.
India is currently the 10th largest insurance market globally with premium volume of $136 billion and is projected to become the 6th largest by 2032.
National Insurance Company Ltd (NICL), Oriental Insurance Company Ltd (OICL), and United India Insurance Company Ltd (UIICL) continue to report negative solvency ratios despite government capital infusions of Rs 17,450 crore between 2019-20 and 2021-22.
The panel also urged the GST Council to examine insurance taxation, revision of Motor Third Party premium rates to actuarially sound levels, and a standardised hospital pricing framework for cashless health claims.
- Who
- The Committee on Public Undertakings (CoPU), chaired by BJP Member of Parliament Baijayant Jay Panda, addressing the Department of Financial Services (DFS) and the Insurance Regulatory and Development Authority of India (IRDAI)
- What
- Recommended setting specific, time-bound annual targets to increase life and non-life insurance penetration, along with solvency and governance reforms for public sector insurers
- Where
- India
- When
- Date of the report's release is not specified in the article
- Why
- India's insurance penetration of 3.7% of GDP is nearly half the global average, and the government aims for 'Insurance for All by 2047'
Key facts
- Insurance penetration (India)
- 3.7% of GDP
- Global average penetration
- 7% of GDP
- Insurance density
- USD 95 per capita (global average: USD 889)
- Global market rank
- 10th largest, with $136 billion in premium volume
- Projected rank by 2032
- 6th largest insurance market
- Non-life insurance penetration
- 1% of GDP (global average: 4.2%)
- Capital infusions to public sector insurers
- Rs 17,450 crore (2019-20 to 2021-22)
- PSGI underwriting losses
- About Rs 96,861 crore (FY2019-20 to FY2023-24)
Quotes
Committee on Public Undertakings (CoPU)
Mandated parliamentary committee
“The panel stressed that insurance penetration should not be measured only through premium‑to‑GDP ratios but also by “the extent of meaningful financial protection available to households, farmers, workers, small businesses and vulnerable sections of society.””
financialexpress.com
“The Committee recommends that DFS and IRDAI set specific, time‑bound targets for increasing both life and non‑life penetration, with annual milestones published transparently so that progress can be tracked.”
financialexpress.com
Sources
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