With premium growth declining and other business costs including claims going up, with more competition injected into the market and with the domestic economy skidding, the non-life insurers are at their wit's end to climb out of the abyss they find themselves in post-detariffication. This article analyzes the situation and provides a few suggestions to solve the crisis.

How is the market scenario unfolding in 2009-10 for the non- life insurers? Is this year likely to be the most challenging one for them since liberalization? How are they dealing with the challenges of the detariffing initiative from 2007 and the global financial meltdown from 2008, which are now threatening their financial stability? Would they emerge out of the crisis without bloodying themselves too much?

This article discusses the unpredictable challenges, which threaten the economic viability of the non-life insurance system in India, and more particularly the private players. These players with relatively lower net worth have built up a large market share of 40% of potentially loss-making portfolios in motor and health in a short span, with a restricted scope to generate investment incomes from the struggling stock market.

The PSU players with their investments built up over several decades in the past are also subject to the same market challenges; but they seem better placed to deal with the economic storms now raging in the market. The symptoms of the gathering crisis are identified below to better understand the sources of their problems.

Insurance Chronicle Magazine, Non-Life Insurers, Economy Skidding, Financial Stability, Premium Revenues, Health Premiums, International Reinsurers, Corporate Governance, Risk Management, Ethical Conduct, Management Information System, MIS, Brand Name.