Insurance penetration is measured as a ratio of premium to Gross Domestic Product (GDP). Here is a look at the insurance penetration in the emerging Asian countries in 2010. The total penetration is a sum of individual penetration in the life insurance and non-life insurance space.
Taiwan has the highest insurance penetration of 18.4%, while the lowest penetration stands at 0.7% in Pakistan.
The total insurance penetration in India dropped to 5.1% in the financial year 2010-2011 from 5.2% in 2009-2010. This was primarily due to a drop in the life insurance penetration from 4.6% in 2009 to 4.4% in 2010. On the other hand, the general insurance or non-life insurance saw an increase in penetration from 0.6% in 2009 to 0.7% in 2010.
Life Insurance in India:
After the change in Unit-linked Insurance Plans (ULIPs) regulations in 2010, Indian Insurance industry witnessed a slowdown in premium growth. This put a lot of pressure on the underwriting margins of life insurance companies and slowed the growth of new business. Post these guidelines, insurance companies were compelled to shift their focus to traditional (guaranteed) products such as moneyback, endowment as well as protection plans. However, considering the high popularity of ULIPs, in the long run, it continued to remain a key contributor to their overall business.
Non-life Insurance in India:
The non-life insurance industry on the other hand, performed very well, with growth in premium collections. This growth can be attributed to the strong performance of the motor, property business and standalone health insurance companies.
