Analytical Study on Indian Life Insurance Industry in Post Liberalization Dr.Anshuja Tiwari, Assistant Professor, Barkatullah University Babita Yadav, Faculty of Managment
India is fast emerging on the world map as a strong economy and a global power. With a huge population and large untapped market, life insurance happens to be a big opportunity in India. Soon after the liberalization, there was a remarkable improvement in the Indian life insurance industry. After 1991, the Indian life insurance industry has geared up in all respects, as well as it being forced to face a lot of healthy competition from many national as well as international private insurance players. The present descriptive and analytical secondary based study was conducted with an objective to analyze the condition of life insurance industry in post-liberalization. Ten years of secondary data have been collected and analyzed by the researcher from the period 2001 to 2010. The study has been focused to analyze the overall impact of liberalization on life insurance business in terms of total premium income, total income, market share and number of policies. There is no significant impact of liberalization on the growth of Indian life insurance business is the main assumption of the present study. Private insurance companies are expanding their business and giving tough competition to LIC, continuous down fall in the market share of LIC after privatization, new business is increasingly going towards private insurance companies but still holding the dominant position and the most trusted brand among the people, in the post liberalization period, the life insurance industry of India witnessed a marvelous growth and touched its historical height are some of the major findings of study. The suggestions recommended by the researcher will be extremely useful for life insurers to bring further improvement in the business of life insurance and its penetration. Keywords: Competition, Liberalization, Life Insurance Industry, Insurance Growth, LIC, Private Life Insurers. International Journal of Social Science Tomorrow Vol. 1 No. 2 ISSN: 2277-6168 April|2012 www.ijsst.com Page | 2
Life Insurance Corporation of India was the only company prior to liberalization and the monopoly of LIC breaks with the entry of private companies in life insurance business. The Indian insurance industry was opened for private insurers in the year 1999, with the enforcement and establishment of industrial regulatory and development authority act. Insurance sector in India is one of the booming sectors of the economy and presently growing at the rate of 35-40% per cent annually with a total insurable population of less than forty percent. Huge untapped population provides unlimited scope to life insurance companies for market expansion and penetration. There was a remarkable improvement in the Indian insurance industry soon after the Indian economic reform 1991 which is characterized by three important elements i.e. Liberalization, privatization, and globalization (lpg). In the post liberalization period, the life insurance industry of India witnessed a remarkable growth and it is being forced to face a lot of healthy competition from many domestic as well as international private insurance players. 1.1 Meaning Of Liberalization
Liberalization is the gateway of globalization and regulates the financial market by reduction of tariff and non-tariff barriers, abolishment of industrial LICensing and by exercising control over foreign direct investment. The major purpose of liberalization was to free the large private corporate sector from bureaucratic controls. Liberalization of insurance industry has witnessed major structural transformations and growth in life insurance business. To end the monopoly of the life insurance corporation of India and to...