The IRDA Chairman Mr. J Hari Narayan expressed serious concerns about fencing around the insurance industry due to the dropping premium collection offered after de-tariffing. In the 8th Summit of the Insurance Brokers Association of India (IBAI) which was held a couple of days back, Mr. Hari Narayan spoke about how the reduction in income from premiums is an increased risk to the health of the insurance industry.
Although the non-life insurance industry has been expanding over the last few years, profitability still remains a challenge. Except for one company, all the other companies continue to incur huge losses on underwriting every year which is being closely monitored by the regulator. The Chairman strongly advocated that companies should focus on achieving their underwriting principles and not merely top-line growth. The viewpoint was that insurance companies should avoid unhealthy competition based on prices alone and look at ways to tap the growing Indian market.
Mr. Hari Narayan discussed that collectively the insurance companies and the industry were exploring options to achieve this huge but important task of healthy growth. Restructuring the claims settling system to make it more equitable manner and dematerialized forms of policies were a couple of initiatives that are expected to ease the burden in the coming years.
