Insurance industry must play a pivotal role in India’s growth story: Vice President

 Image for Representation Purpose: Screengrab of Homepage, Vice President of India

Addressing the gathering after inaugurating the Centenary Celebrations of The New India Assurance Company Limited, The Vice President of India, M. Venkaiah Naidu shed light on very relevant issues related to the insurance industry and how the industry can widen its reach to serve the common people.

Impact News is sharing the entire text of Vice President’s address which is very relevant:

“I am delighted to take part in today’s function, marking the beginning of the centenary celebrations of The New India Assurance Company Limited.

Centenary year is a memorable and proud milestone for any organization, particularly so for an institution which is serving the needs of the people in the insurance sector. On this occasion, I would like to congratulate each and every individual associated with the company for its growth and business performance over the last 10 decades.

New India was promoted 99 years ago this day as the first wholly Indian owned insurance company as Indian customers were not getting the best of treatment at the hands of foreign insurers. India’s freedom struggle had gathered momentum and its fledgling industry needed all the support it could get.

Eminent and highly respected Bombay industrialists joined hands under the leadership of the house of Tatas to promote New India Assurance on July 23, 1919. The very name of the company reflected the hope and joy and the nationalistic pride of its founders and the company’s focus on excellence in its chosen field.

In the words of its founder-Chairman, Sir Dorab J Tata, the illustrious son of renowned, pioneering Indian industrialist Jamsetji N Tata, “The New India constitutes the commencement of a new and large commercial undertaking for India. It is not a Bombay Insurance Company or a Company working solely in India, but may claim to be a Worldwide Company.” That indeed was the vision of the founders when it was started. 

I am glad that since then the company offered a wide range of general insurance covers and has been a major player in insurance sector in the Indian market. Not surprisingly, New India was also a Life Insurer and at the time of Life insurance nationalisation in 1956, its life insurance portfolio became part of Life Insurance Corporation of India.

New India also boldly ventured into foreign lands, establishing operations in London, the world reinsurance hub in 1920. Through its history, the company has had a presence in many countries and now operates from 28 countries.

New India Assurance in that sense is a truly Indian multinational Company.

With a gross written premium in 2017-18 of Rs 26,554 crore and a growth rate of 16 per cent, I am told that New India has a market share of over 15 per cent in the country’s general insurance business, carving out a unique position for itself in a highly competitive market with over 30 companies.

The true worth of an insurance company is gauged by its claims settling performance and I am told that New India has improved its settlement ratio to 97.32 per cent for 2017-18.  The net worth of the Company is currently close to Rs. 40,000 crore and the fact that the Company had literally no capital infusion until the recent IPO, is highly commendable.

Dear sisters and brothers,

India’s challenge today is to support its various socio-economic classes and fulfil their aspirations for a bright and secure future. The common man wants food security, good health and financial well-being. The Industry wants quick responses, suitable and innovative solutions and a reliable friend during times of loss and distress to get back on its feet.

Both industrial development and financial inclusion have to take place hand- in-hand for India to continue its onward march and become one of the leading economies in the world in the next two decades. The insurance industry will need to play a pivotal role in India’s growth story by offering innovative risk covers, policies and schemes.

I commend New India for playing an important role in the Government-backed insurance schemes under the Pradhan Mantri Jan Dhan Yojana, namely Pradhan Mantri Surakhsha Bima Yojana, RashtriyaSwasthya Bima Yojana and other mass health insurance schemes or the country-wide crop insurance scheme Pradhan Mantri Fasal Bima Yojana.

I am sure that it will be actively involved in Ayushman Bharat, or the National Health Protection Scheme which has the ambitious aim of providing health cover to almost 50 crore people worth Rs 5 lakh each every year.  In this context, I am confident that the future plans and visions of New India will contribute significantly to the Prime Minister’s programmes for national development.  
Although, the insurance industry over the years has grown significantly, there is a lot of ground to cover.

The overall insurance penetration reached only 3.69 per cent in 2017. It is the responsibility of insurers like New India to contribute to making India fully insured at the earliest.

In the wake of the various reforms initiated by the government in the economic sector, the Indian insurance industry is projected to grow to US $ 280 billion by 2020.

There is a vast scope for the insurance industry to grow and create employment in the country. The insurance companies need to come out with innovative schemes and products for more and more people to avail of their services. The products have to be unique, simple, customer-centric and innovative especially in the face of growing competition in the market and rapid technological changes.

Apart from need-based and innovative covers from insurers, the citizens look for effective and efficient delivery of both the covers and the claims. The general insurance industry, especially health insurance and home owners insurance, is fully penetrated in developed countries with hardly anyone without an insurance policy or not being part of an insurance scheme.

With the insurance market expected to more than triple to US$ 280 billion in the next two years, the insurance industry should leverage the digital technology and be the development partner in building a Vibrant India.

The other urgent need of India is employment and for that, we have to develop constantly skills for employability. The insurance companies should leverage demographic dividend to impart employable skills to the youth. In the end, it will be a win-win situation for both the companies as well as the youth. Long-term and constant skill development and enhancement is imperative for India so that it can keep up with the best in the world.

I wish New India Assurance and its employees all the best for their future endeavours.

 

Jai Hind!