GROWTH DRIVERS OF INSURANCE SECTOR IN INDIA – A STUDY

This paper attempts to articulate the various underlying growth drivers for India's insurance industry. India is a growing economy with the increasing number of working population in the country; the disposable income is also increasing. As the income increases the spending on consumers goods, automobiles, travel which are various insurance lines. The awareness about insurance among people has been increasing along with the number of providers and the range of products available at competitive prices. Moreover the regulatory environment is conducive for the insurance sector to bloom. All these factors led to increase in the universe of potential buyers for insurance such as individuals, companies across businesses. More than two- third of India's population lives in rural areas which are untapped when it comes to insurance products. Micro insurance can be focused upon to ensure coverage in these areas. In the long run, the insurance industry is still poised for a strong growth as the domestic economy is expected to grow steadily. This will lead to rise in per capita and disposable income, while savings are expected to be stable. The demand for insurance products is likely to increase due to the exponential growth of household savings, purchasing power, the middle class and the country's working population. The insurance market has a considerable amount of latent potential, given the fact that the Indian economy is expected to do well in the coming decades leading to increase in per capita incomes and awareness.