The urban population of India constitutes almost a third of the total population. Therefore, the growth potential for insurance business is said to be on the positive side at least for the next five years. Since insuring the maximum number of people is the primary goal of every insurer, it is necessary for the insurers to be equipped with advanced tools, so as to make the process of proposal generation and acceptance simple, accurate and fast. The aim is to ensure that the insurability of a proposal is not overlooked. Insurability on the other hand is a compound factor which is determined by a number of variables like age, sex, weight, occupation, etc. Apart from these vital variables, location is also an important one which needs to be considered before accepting a proposal. Though, location information is not readily available to the insurer, knowledge about the risk exposure of an insurable or insured person is important to run an insurance business successfully.
Not all the applications received come from less risk locations. There are, for instance, proposals from people who are located near an atomic power plant, a copper smelting plant, a gas filling station, a fertilizer manufacturing company, an earthquake-prone area, etc. which throw risk to people and property in the form of potential health hazard and property damage which also influences the consideration of a proposal or claim. Thus, only a careful examination of the proposer's locality will reveal certain risks which are significant to insurance underwriting but go unidentified in the absence of a thorough investigation of the proposer and his environment. Beforehand information about the hazard-prone location's proximity to the proposer will enable in avoiding adverse claims. However, gathering such location-specific information is not the business of the insurer, but having access to it will be of immense help to the insurer in controlling the outflow of insurance products and its costs. Geographic Information System (GIS) is the latest technology which gives access to a huge database of spatial information. |
