Cooperation among insurance regulators in South Asia is crucial for the industry’s growth and to increase penetration, according to TS Vijayan, Chairman, Insurance Regulatory and Development Authority of India (IRDAI).
In his inaugural address at the International Insurance Conference and 4th South Asian Regulators’ Meet, hosted by the IRDAI here on Saturday, Vijayan said that though there were deliberations on other global insurance platforms, cooperation between South Asian regulators will bring global attention to region-specific problems.
India, Pakistan and Bangladesh together account for 23 per cent of the world’s population but were low in insurance penetration, at less than 4 per cent, he explained. “There is significant scope for insurance penetration,’’ Vijayan added.
Tailored products needed
Citing the success of low-cost insurance schemes such as the PM’s Jeevan Jyoti Bima Yojana, Suraksha Bima Yojana and Fasal Bima Yojana, which increased awareness, he said tailored solutions catering to different sections of society would increase penetration.
Referring to the recent growth in the insurance industry in the country, Vijayan said the total premium of insurance in the country would be over ₹6 lakh crore in financial year 2017-18.
Insurers are working towards adopting International Financial Reporting Standards by 2021, he said. “Active consultations are underway” for upgradation and updation of accounting practices and systems,” Vijayan added.
In his keynote address, VK Sharma, Chairman, Life Insurance Corporation of India, (LIC) said India and South Asia could collaborate a lot in insurance. “We have developed a knowledge base and skills,” he pointed out.
Positive experience
Referring to LIC, Sharma said the insurer’s experience in South Asian countries, including Sri Lanka, Nepal and Bangladesh, was “positive”.
In India, the asset base of the corporation was at ₹28.54 lakh crore as of December 2017 and LIC was betting big on technology, he said. “Today, about 50 per cent of our premium comes from tech-based solutions,” Sharma added.
Premium to the tune of ₹400 crore is being collected daily with the aid of technology solutions. As the government was taking many initiatives such as rolling out of new low-cost insurance schemes, the industry should also actively collaborate to increase insurance penetration, Sharma observed.