It is possible to raise life premium as a percentage of GDS in India from the existing levels. The big question is whether the players are able to effectively exploit the potential by creating and marketing attractive insurance products with high rates of return on premium investments. This would help deepen the market as the same family could opt for different schemes catering to different needs. Fourthly, GDS as a percentage of GDP is very low in India. Contrary to the fact that the culture of saving is inherent in the Indian way of life, is another fact that it is not sufficiently harnessed by motivation.
Savings provide resources for high levels of investment which in turn acts to fuel overall growth.
Such an increase will considerably broaden the size of the existing life insurance market. Clearly, this is a sector to be watched. There are a number of impending changes that are likely to make this sector more dynamic. The following report traces out the structure and the system as prevails in the insurance sector in India. This is followed by a brief critique of the recent announcements concerning the sector.