The General Insurance Industry in India has seen a gamut of changes in the past one decade. The year 1999 saw a revolution in the Indian insurance sector as major structural changes took place with the ending of government monopoly and the passage of the Insurance Regulatory and Development Authority (IRDA) bill lifting all entry restrictions for private players and allowing foreign players to enter the market with some limits on direct foreign ownership. With the fast changing liberalization policies, changing and growing demands of the consumers made the industry competitive. The general insurance players now offer greater choice in terms of products and services. They also make a concerted effort to increase consumer awareness about the benefits and importance of insurance via vigorous marketing. The changing reforms have also triggered change in the taste and preferences of the consumer. This paper analyzes the factors that influence the buying decision of the consumer regarding any general insurance policy. The result of the research reveals that the purchasing decision of the consumer depends on quality, accessibility, company type, recommendations and promptness of service.
The
authors present their intuition about the general insurance industry and how liberalization
has influenced the industry. Their intuition directed that the entry of private
players has introduced competition, greater product innovation, better service
and efficient delivery channels. Liberalization has introduced a sea change and
spurred growth in the last five years. The non-life industry's expansion has coincided
with the growth in income of the Indian middle class, and the rising ambitions
of the Indian corporate sector, thus opening up the potential of previously under-penetrated
and/or unexplored segments like health and liability insurance. Competition from
the private sector is also spurring the public sector insurers towards greater
efficiency.
As
per Swiss Re, economic research and consulting, the non-life insurance market,
which recorded gross direct premiums of INR117.84 bn in FY01, the first year that
the market was liberalized, has since grown rapidly. The total premium written
in FY05 amounted to INR180.9 bn (INR104.15 bn in H106), generated by 14 insurance
companies. The industry recorded a year-on-year premium growth of 12.8% in FY05
and grew by a further 57.6% in the first six months of FY06. In FY05, the five
public sector companies together had a market share of 80.4% (based on GWP), with
the private companies making up the remaining 19.7%. The top three players in
the non-life sector in FY05 ICICI Lombard, Bajaj Allianz and Iffco-Tokiotogether
account for about 12% of the total non-life market. |
