India has been one of the most promising markets globally for the insurance industry with the highest number of young insurable population. People in India are realising the need for protection and social security since the 20s. The insurance industry in India is further set to grow with a multitude of factors such as structural rise in financial savings (as a percentage of household savings), high protection gap and rapid penetration of digitisation. The growth in Asset purchases has increased tremendously with the growing economy. People in India are well equipped with jobs, professionals and businesses. Their financial profitabilities are hitting the goals and thus they can now focus on protecting their hard-earned assets.
India has seen since last year, more than 35,000+ crore deployed as capital and over 11003 branches becoming operational Life Insurance companies are still grappling to wipe out accumulated losses. Insurance business has a long term nature whereby no predetermined criteria is present to monitor the effectiveness of insurance operating companies.
Commencing insurance business without measuring profitability is wither and will make company emaciated.
To avoid such situations, insurance companies have started relying on bookkeeping for accounting purposes. However this provides only fractional information about the profitability and does not gives the factual viewpoint. Insurance companies in India were investing heavily to build distribution but the ROI took unusually long time.
Continued losses occurring affect the end consumers as it results in laxity in claims management or towards investments on initiatives for innovation and better quality of products and services. To avoid such cases, insurers will need to write sustainable business and fund their business growth and customer service innovations by generating profits.
Businesses those are well disciplined are always good for consumers
Insurance industries in India in the long run will be benefited if the pricings will be risk-based and not succumbing to market pressure..
Insurance industries will need to ensure profits through disciplined underwriting and a healthy solvency ratio. This will be very critical for the insurance industries to ensure sustainable growth and to provide good return on capital to shareholders. Reassessing several key aspects of the business models, right from pricing to products, distribution, risk management, claims management and adoption of technologies for a stellar customer experience will be suggested actions.
AdWISE Assure helps companies in building efficiency to tide over and square off accumulated losses which gets clearly reflected in surplus generation on underwriting, investment and expense ratio.