New Delhi, May 5 The policies of the companies should be oriented towards increasing overall insurance penetration and density, while ensuring retention of market share, said M. Nagaraju, Secretary, Department of Financial Services (DFS).
He underscored the need to expand insurance coverage to a wider segment of the population, advising that companies should prioritise inclusion of more individuals under the ambit of insurance rather than concentrating predominantly on big-ticket policies.
A meeting was convened here to undertake a comprehensive review of the vision strategy documents of three public sector insurance/reinsurance companies — Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC Re) and Oriental Insurance Co Ltd. (OICL)
The companies were advised to devise investment and underwriting strategies to reduce loss ratios, according to a Finance Ministry document.
Key areas that were deliberated upon are developing new and innovative customised products; augmentation of digital and technological capabilities while adhering to prescribed cybersecurity frameworks; expansion of insurance services through online platforms,
timely resolution of public grievances; expanding distribution networks and enhancing communication and publicity through various platforms, including social media.
The vision strategy documents covering the medium-term (three-year) and long-term (five-year) horizons were examined during the meeting.
Secretary (DFS) offered strategic direction aimed at boosting operational efficiency and reinforcing financial stability, while underscoring the importance of fostering sustainable growth.
Instructions were also issued to further develop Human Resource and Information Technology strategies to enhance overall service delivery, said the statement.
Meanwhile, the Union government has notified 100 per cent foreign direct investment (FDI) in the insurance sector under the automatic route, paving the way for greater participation by overseas investors.
Foreign investment in insurance companies will be subject to compliance with provisions of the Insurance Act, 1938, and mandatory approval from the Insurance Regulatory and Development Authority of India (IRDAI) for undertaking insurance and related activities.
Investments in LIC will remain governed by the Life Insurance Corporation Act, 1956, along with applicable provisions of the Insurance Act.
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