History of Insurance in India – Evolution in India
Insurance is one of the trending topics in India. We are approaching a world where we need to get insurance for every uncertainty. Insurance has been with mankind for a long time. The assurance for any activity or uncertainty is known as insurance. Back in the day, we used to get assurance in barter terms, but nowadays, everything is in monetary terms. With the history of insurance in India dating back a few thousand years, one should understand everything about the same.
We are not talking about the ancient form of insurance in India, but the modern form, which we practice in our daily life. With the modern insurance history from 1818, you can understand how it evolved over time. In this post, you will find detailed information about the history of insurance in India.
History of Insurance
Start of the Modern Insurance Companies
Life insurance in India was started by Britishers in 1818. The Oriental Life Insurance Company in Calcutta, started by a group of Europeans, was the first company on Indian soil that offered life cover.
During that time, the Oriental Life Insurance Company was the only company insuring lives, and this meant that none of its customers were Indians.
Later on, however, with the efforts of people like Babu Muttylal Seal and other eminent citizens of Calcutta, it became possible for Indians to be able to make provisions for their families by purchasing insurance policies from foreign life assurance companies as well.
The only issue was that the Indian lives were considered sub-standard. Hence such companies charged exorbitant amounts for the insurance policies. Bombay Mutual Life assurance company started in 1850, provided services to the Indians at a normal rate.
Nationalization of Insurance Companies in India
In 1956, the insurance companies were nationalized in India. The government then formed the Life insurance corporation of India, which is the biggest life insurance company as of now in India.
The LIC was created to amalgamate nearly more than 245 insurance companies that existed in India and became the largest insurance provider in India to date.
Rise of Insurance Companies in India
There is a competitive market for insurance companies in India. Twenty-four life insurance companies and 34 non-life insurance companies serve the market.
The competitive industry exists due to the introduction of innovative products by life insurance companies, as well as aggressive advertising campaigns to attract new customers.
Cyber insurance is one such amazing product offered by the Insurance companies, which disrupted the market with its innovation.
The insurance industry in India is expected to reach a value of US$ 280 billion in the coming years. The life insurance industry is expected to increase at a CAGR of 5.3% between 2019 and 2023.
In 2015, India’s insurance reach was capped at 4.2%, with life insurance reach at 3.2% and non-life insurance reach at 1%. Insurance density in India was $78 in 2015.
Final Words
These days, no one should ignore any kind of insurance for the users. With the increased awareness about the insurance sector, one can easily gauge the potential and the need for the same.
The history of Life Insurance in India dates back to a few hundred years with the arrival of the Britishers or the East India company. Since that time, the insurance sector has only witnessed growth.
