20 apps for insurance companies in the works: Panda [Boss Insurance]

20 Apps For Insurance Companies In The Works: Panda

India’s Insurance Regulatory and Development Authority (Irdai) has received 20 new applications to set up life and general insurance operations, Chairman Debasish Panda said on Wednesday. Three new insurance companies have registered with Irdai – two in life insurance and one in general insurance. About 20 more applications are being processed,” Panda said.

Panda was speaking at the Federation of Indian Chambers of Commerce and Industry’s annual insurance conference, ‘Winds of Reform’.

On March 31, the insurance regulator granted licenses to CreditAccess Life Insurance Co and Acko Life Insurance Co to conduct life insurance business. Kshema General Insurance recently obtained a license to conduct general insurance business.

The last general insurance company to receive a license dates back to 2017, and the last life insurance company in 2011.
In February, the insurance industry’s total premium reached 10 trillion rupees in 2022-23 (April-March) and assets under management reached 59 trillion rupees, Panda said.

Going forward, the chairman of Irdai expects the industry to grow by around Rs 5 trillion over the next few years with an increase in insurance product penetration. “The new insurance regulations make it more attractive for investors and promoters. I would also like to ask the insurance companies to bring in more capital at a much faster pace,” he said.

Panda acknowledged that the insurance industry now appears to be more competitive from an ROI and ROE perspective, and that the industry is seeing merger activity.

Irdai recently approved new rules on the payment of commissions to insurance agents or insurance intermediaries by insurers. It replaced the previous individual cap on commission payments on insurance products with an overall cap on insurer management expenses. This decision was intended to give insurance companies more autonomy in managing expenses.

Separately, Panda urged insurers to engage with the Insurance Information Bureau (IIB) to mitigate issues related to business operations. “We have reached a point where we must meet the demands of insurance companies in terms of fraud mitigation, underwriting and claims handling and I urge insurers to engage more closely with IIB.”

He highlighted the need to develop more product solutions for the underinsured segment. He urged insurers to partner with insurance technology companies to develop customized products that cater to specific customer segments and geographies.

The regulator had notified the Irdai Regulatory Sandbox in 2019 with the aim of facilitating innovation in the products and solutions offered by insurance companies.