“Rural and social insurance is a very good business opportunity. With urban areas having high insurance penetration, the next growth driver will be rural population,”
According to India Invest Incomes and Savings Survey 2007 by IIMS Dataworks, a Noida-based retail finance research firm, 58% of India’s 105.4 million insured people (out of a total of 321 million people who constitute the country’s paid workforce) are from the rural areas. However, in terms of penetration, or the number of policyholders compared with the total population, urban India is ahead. Thus, penetration in urban India is 47% (which means that almost one out of every two paid workers in urban India is insured), while it is only 27% in rural areas.
With a huge population and large untapped market, insurance happens to be a big opportunity in India
Insurance penetration or premium volume as a share of a country’s GDP for the year 2005 stood at 2.53% for life insurance and 0.62% for non-life insurance. The level of penetration tends to rise as income increases, particularly in life insurance. India, with its huge middle class households, has exhibited potential for the insurance industry. This has made international players to look at the Indian market. Moreover, saturation of markets in many developed economies has made the Indian market all the more attractive for global insurance majors. There exist a vast potential in...