Analyses of insurance industry.

1. “Insurance” Industry Analysis
Presentations

2. INTRODUCTION TO INSURANCE
 Equitable transfer of the risk of a loss from one entity
to another in exchange for payment
 Hedge against the risk of a contingent, uncertain
loss.

3. ….continued
 The insured, or policyholder:
Person or entity buying the insurance policy.
 The amount of money to be charged for a certain
amount of insurance coverage is called the
premium.
 Risk management, the practice of appraising and
controlling risk, has evolved as a discrete field of
study and practice.

4. OVERVIEW OF INSURANCE INDUSTRY
 Early methods:
By Chinese and Babylonian traders as long ago as
the 3rd and 2nd millennia BC, respectively
The Babylonians developed a system which was
recorded in the famous Code of Hammurabi, 1750 BC,
and practiced by
early Mediterranean sailing merchants

5. ……continued
 Modern insurance:
Property insurance can be traced to the Great Fire of
London, which in 1666 devoured more than 13,000
houses.
in 1681, economist Nicholas Barbon and eleven
associates established the first fire insurance company,
the "Insurance Office for Houses", at the back of the
Royal Exchange to insure brick and frame homes.
Initially, 5,000 homes were insured by his Insurance
Office.

6. Insurability
Risk which can be insured by Insurance companies
typically shares common characteristics:-
 Definite loss
 Accidental loss

7. Insurance industry in India:
 Insurance in India refers to the market
for insurance in India which covers both the public
and private sector organizations
 IRDA is the regulatory body for insurance sector in
India

8. Industry structure
 By Feb 25, 2015 Indian Insurance is a US$40.26
billion industry
 Only two million people (0.2% of the total
population of 1 billion) are covered under
MediClaim.

9. LIST OF INSURANCE COMPANIES IN INDIA
 General insurance companies
 Public Sector
 United India Insurance Comp. Ltd.
 New India Assurance comp. Ltd.
 National Insurance Company
 The Oriental Insurance Company
 Life Insurance Corporation of India
 Agriculture Insurance Company of India Ltd.

10. Private Sector Co.
 Bharati AXA Insurance Company
 Bajaj Allianz General Insurance Company
 Cholamandalam MS General Insurance Company
 Future Generali Insurance Company
 HDFC ERGO Insurance Company
 ICICI Lombard
 IFFCO Tokio
 Liberty Videocon General Insurance Co Ltd
 L&T Insurance Company
 Magma HDI Insurance Company
 Raheja QBE Insurance Company
 Reliance General Insurance
 Royal Sundaram Alliance General Insurance
 Shriram Insurance Company
 SBI General Insurance Company
 Tata AIG General
 Universal Sampo Insurance Company

11. Life insurance companies
Public Sector
 Life Insurance Corporation of India

12. Private Sector
 Edelweiss Tokio Life Insurance Co. Ltd.
 AEGON Religare Life Insurance
 Aviva India
 Bajaj Allianz Life Insurance
 Kotak Mahindra Old Mutual Life Insurance
 TATA AIA Life INSURANCE
 Reliance Life Insurance
 Star Union Dai-ichi Life Insurance
 HDFC Standard Life Insurance Company Limited
 IDBI Federal Life Insurance
 IndiaFirst Life Insurance Company
 Birla Sun Life Insurance
 Max Life Insurance[2]
 ICICI Prudential Life Insurance Company
 Canara HSBC OBC Life Insurance Company Pvt Ltd.
 BHARTI Axa life insurance company
 Exide Life Insurance company Ltd
 L&T general insurance co LTD
 SBI Life Insurance Company
 DHFL Primerica life insurance

13. Health insurance companies
 Apollo Munich
 Cigna TTK
 ICICI Lombard
 Max Bupa Health Insurance Company
 Star Health and Allied Insurance
 Religare health insurance
 E-Meditek
 Medi Assist
 MD India
 Medsave
 Paramount Health care Services
 ICICI Prudential
 ICICI Lombard
 Vipul Medcorp
 United Health care Parekh
 HDFC Ergo
 Family Health Plan Ltd.
 Dedicated Healthcare Services


14. Re-insurance companies
Public Sector
Government of India Fully owns 1 company: GIC Re

15. Types of insurance
 Auto insurance
 Gap insurance
 Health insurance
 Accident, sickness, and unemployment
insurance
 Casualty
 Life

16. SWOT Analysis of Insurance Sector
STRENGTHS:
• New Products
• Business Growth
• Rise in per capita Income
• Emerging Middle Income
Group
WEAKNESS:
• Low investment
• Dominance of Public sector
• Promotion as a Barrier
• Old tariff structure
• Limited facilities
OPPORTUNITIES:
• Creation of stronger demand
• Strong future growth
• Rise in Income and Awareness
• Health insurance
Threats:
• The political environment is not
conducive to constructive change
• The dominance of entrenched
players who make industry stagnate.
• The legal framework, bureaucracy
and financial infrastructure worsen
the insurance business environment

17. Porter’s Diamond Model

18. Results of the Michael Porter’s Diamond
Analysis of Competiveness
 Demand conditions: nature of home demand.
 Factor conditions: nation’s position in factors of
production such as skilled labor force and infrastructure.
 Firm strategy, structure, and rivalry: how companies
are created, organized, managed and the nature of domestic
rivalry.
 Related or supporting industries (RSI): presence or
absence RSI that are internationally competitive.
 Two additional variables: government and chance.

19. The development of Insurance Industry:
The development of insurance industry can be divided
into three stages:
 Resumption and restoration,.
 Market-oriented reform, and
 Opening up and rapid growth.

20. Future prospect of Insurance Industry
 Globalization has had a profound impact in shaping the
insurance industry.
 The near future of insurance industry sees a significant rise in
share as more and more service providers both Indian and
global target new segments and provide low cost, flexible
solutions to customers
 Over the years, verticals like manufacturing, telecom,
banking, finance and lately the retail, have been the growth
drivers for this sector. But it is very fast getting clear that the
future growth of insurance sector will be fuelled by the
verticals of change in the mind set of people towards need of
insurance for future risk minimization and coverings.