Number of Tables: 1
This IDC study highlights key initiatives taken by India-based insurance players to combat rising costs and inherent system inefficiencies.
India is a vibrant market as far as insurance is concerned. The India market continues to be one of the least penetrated markets, thus making this a high-potential industry. The need for insurance as a necessary instrument of financial risk protection and investments is not yet completely realized, leading to low penetration rates. The young population far outnumbers the older generation, and there is rising demand for insurance offerings from the emerging middle class. "Though the past few years have been slightly discouraging, the crystal ball for the India insurance sector shows promising days ahead," exclaims Kannagi Shekhar, senior market analyst, IDC Consulting.
This study also captures the key measurable benefits of these initiatives to these organizations. Whereas the focus of the insurers in 2005–2010 was on gaining market share, the current areas of their concern are business acquisition costs, retention of business, and persistency. The ratio of customer acquisition costs and operational expense is still very high — marring the bottom line. Although most general insurers have been turning to operational profits, many life insurers are still far from realizing operational profits.