in case of damage, the insurance cover may pay for the damages and reconstruction; a car insurance could recover damages due to any accident or natural disaster; health insurance would cover the hospital expenses in case of any illness; and a life insurance could help in providing precious funds for your family in case of your untimely death.
" Insurance is an important financial tool that prevents you from any financial setback caused due to damage/illness from such natural calamities," said Adidamu." It is always advisable to cover your family and assets with insurance rather than wait for such eye-opener events to happen."
Companies typically see a rise in inquiries for various insurance plans after such disasters, but officials say that the conversion rate remains low.
"The risk awareness has to go up," said Datta. "Everyone needs to be attached to their health, assets, home and all that, which is one of the ongoing efforts of bringing about awareness. The second and the important part is ensuring that the products and the distribution are simple and easy to reach the consumer."
Increasing insurance penetration in India has been a major focus area for Insurance Regulatory and Development Authority of India (IRDAI). In 2015, the regulator introduced the new distribution
When catastrophes strike, lives are lost, homes are destroyed and many of these people who never saw a need for buying insurance, end up bearing the losses.
" India suffers from a typical issue of under-penetrated insurance market. Only about 5 per cent economic damage gets covered by insurance," said Sanjay Datta, chief of underwriting, reinsurance and claims at ICICI Lombard General Insurance Company.
Globally, there were 301 disasters in 2017, with the total economic losses estimated at $337 billion, nearly double the $180 billion in 2016 and well above the inflation-adjusted average of $ 190 billion in the previous ten years, according to Swiss Re. Losses covered by the insurance industry in 2017, however, were only $ 144 billion.
In India, where the per-capita income is low and there have been many natural disasters in different parts of the country, there is a clear need for people to get insured." The victims of such disasters suffer big financial loss, and for most of them, it drains out their entire life savings. Individuals with insurance are indemnified of the losses by their insurance company, giving relief in terms of the financial losses," saidEaswaraNarayanan, COO of Future Generali India Insurance.
If a house is insured, then
channel, insurance marketing firm (IMF), in a bid to increase area-wise insurance penetration. In June this year, it set up a 10-member panel to review norms around the IMF.
Subhash Chandra Khuntia, who was appointed as the chairman of IRDAI in May, believes sustained economic growth over the next few years will drive insurance sector growth, but he says customer focus should be key and companies must take steps to make insurance products more desirable.
" Only customer-centric policies will be able to lead us to sus-tainability," said Khuntia. "For insurance companies to succeed over a long period and to build trust with the customers, we must have the customer as our central point. If we build that kind of relationship and trust, insurance will not be a push product, it will be desired by the customers."
Khuntia sees a clear need
INDIA SUFFERS FROM A TYPICAL ISSUE OF UNDER-PENETRATED INSURANCE MARKET. ONLY ABOUT 5 PER CENT ECONOMIC DAMAGE GETS COVERED BY INSURANCE.