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General Insurers

Any insurance other than ‘Life Insurance’ falls under the classification of General Insurance. It comprises of:
  • Insurance of property against fire, theft, burglary, terrorism, natural disasters etc
  • Personal insurance such as Accident Policy, Health Insurance and liability insurance which covers legal liabilities.
  • Errors and Omissions Insurance for professionals, credit insurance etc.
  • Policy covers such as coverage of machinery against breakdown or loss or damage during the transit.
  • Policies that provide marine insurance covering goods in transit by sea, air, railways, waterways and road and cover the hull of ships.
  • Insurance of motor vehicles against damages or accidents and theft
All these above mentioned form a major chunk of non-life insurance business.
In the Government Control, General Insurance Corporation of India (GIC) (with effect from Dec' 2000, a National Reinsurer) GIC had four subsidiary companies, namely
  1. The Oriental Insurance Company Limited
  2. The New India Assurance Company Limited
  3. National Insurance Company Limited
  4. United India Insurance Company Limited.
(With effect from Dec'2000, these subsidiaries have been de-linked from the parent company and made as independent insurance companies)
The Insurance sector in India is governed by Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and General Insurance Business (Nationalization) Act, 1972, Insurance Regulatory and Development Authority of India (IRDAI) Act, 1999 and other related Acts. With such a large population and the untapped market area of this population, insurance happens to be a very big opportunity in India.
Today it stands as a business growing at the rate of 15-20 per cent annually. Together with banking services, it adds about 7 per cent to the country's GDP. In spite of all this growth the statistics of the penetration of the insurance in the country is very poor. Nearly 80% of Indian populations are without Life insurance cover and the Health insurance. This is an indicator that growth potential for the insurance sector is immense in India.
It was due to this immense growth that the regulations were introduced in the insurance sector and in continuation "Malhotra Committee" was constituted by the government in 1993 to examine the various aspects of the industry. The key element of the reform process was Participation of overseas insurance companies with 26% capital. Creating a more efficient and competitive financial system suitable for the requirements of the economy was the main idea behind this reform.
Since then the insurance industry has gone through many sea changes. The competition that LIC started facing from these companies were threatening to the existence of LIC. Since the liberalization of the industry, the insurance industry has never looked back and today stand as the one of the most competitive and exploring industry in India. The entry of the private players and the increased use of the new distribution are in the limelight today. The use of new distribution techniques and the IT tools has increased the scope of the industry in the longer run.

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