Significant economic growth and the support of the government to implement the technology have shown good growth in every sector of the Indian industry. Following the trend, the life insurance industry has also shown significant development in the recent past of the year 2019. Let us take a look at most recent 5 developments that Life Insurance Industry has shown:
Outstanding Growth in Claim Settlement Ratio:
The claim settlement ratio plays a major role in deciding the growth of the life insurance Before finalizing the best life insurance plans people search for a company that has a good claim settlement ratio. It is basically a ratio of total settled claims by the company and the total claims that it has received.
So, the company with high claim settlement ratio is considered the best. The significant point to note here is the growth of Max Life Insurance Company’s claim settlement ration which has even overtaken the leader of the life insurance market that is Life Insurance Corporation of India. Max Life Insurance Company is leading the market with 98.2% claim settlement ratio.
This growth is not stopped here, out of approximately 23 private life insurance providers, 12 are having claim settlement ration more than 95%. In addition to this, 7 private life insurance providers have this ratio between 91%- 95%. There are only three life insurance providers that have a ratio of claim settlement between 80% – 90%. Mentioned below is the claim settlement ratio of different insurance (life) providers for the financial year 2017 – 2018 according to the data provided by the Insurance Regulatory and Development Authority of India (IRDAI):
|Life Insurance Provider||Claim Settlement Ration as Per % of Policies|
|Max Life Insurance Company||98.26%|
|TATA AIA Life||98.00%|
|LIC of India||98.04%|
|HDFC Standard Life||97.80%|
|ICICI Prudential Life||97.88%|
|Bharti AXA Life||96.85%|
|DHFL Primerica Life||96.62%|
|Aditya Birla Sun Life||96.38%|
|Edelweiss Tokio Life||95.24%|
|Reliance Nippon Life||95.17%|
|Canara HSBC OBC Life||95.22%|
|Future Generali Life||93.11%|
|Kotak Mahindra Life||93.72%|
|Star Union Dai-ichi Life||92.26%|
|IDBI Federal Life||91.99%|
|Bajaj Allianz Life||92.04%|
|India First Life||89.83%|
Apart from growth in claim settlement ratio, the life insurance industry has also seen a good jump in the premiums collected against the policy. In the year 2017-18, the amount of premium collected major life insurance providers is Rs.4.58 Lakh Crore, which is a significant jump from previous financial year’s (2016 – 17) record, which was Rs.4.18 Lakh Crore. This is a commendable growth that is showing the warm acceptance of people of the country towards life insurance. This growth is possible because of the introduction of different insurance products to meet the requirements of all type of insurance seekers in India. Not only 23 life insurance providers are coming up with great life insurance products but the public life insurance giants such as Life Insurance Corporation of India (LIC) is also involved in launching life insurance products for meeting the needs of the versatile population of India.
Digitalization in Life Insurance Industry:
The life insurance sector is also seeing a digital push in all its stages. Beginning from the pre-policy issuance, which is verification of the proposal of the insurance applicant, to claim settlement, everything is digital now. An insurance seeker, as well as the policyholder, do not have to go to the branch or contact the agent for policy issuance or claim payout, everything can easily be done online. The movement towards a cashless economy in India has also played a vital role in improving the digitization of life insurance Concepts such as block chain, data analytics, Machine learning, and Artificial Intelligence, Internet of Things (IoT), and other advancements in technology have significantly pushed the digitization in the life insurance sector of the country.
Improved Fraud Management:
An improved claim settlement ratio is the resultant of good fraud management and strong underwriting practices followed by the life insurance provider right at the time of policy and proposal issuance stage. This is possible because of the use of data analytics, strong checks, and the use of technology-enabled verification of KYC. This all has enabled the insurance providers to detect the fraudulent practices and attempts even before the issuance of the policy. In this way, these rigorous practices have enabled insurance companies to reduce fraudulent practices in the life insurance
Life insurance companies are also working hard to reach to the people across the width and length of the country. Insurance providers are finding various innovative ways to do the same such as websites, mobile apps, and integrating a platform for different online insurance brokers, etc. This all is possible because of the digital push made by the insurance companies.
The Future of the Life Insurance Industry:
Digitalization and its implementation are showing the bright future of the life insurance industry in India. The insurance provider that will achieve these parameters earliest will for sure be ahead of others in the race. This is because of the fact that digitization will smooth the insurance journey of the customers which starts right from the life insurance’s application to getting the claim amount. Therefore, these recent developments are creating a delightful and hassle-free journey for both insurance providers and customers. Now we have to see what is there in the kitty of life insurance in the near future.