Recent estimates have shown that the sector is strong in the country and that it will see steady growth.
The latest estimates from the life insurance sector of the industry in India has indicated that there will not only be increases in size over the next five years, but that it will be up to 15 percent compounded annual growth.
There are many reasons for this high growth rate, but it is especially credited to two main ones.
These two main factors that are sending the life insurance industry upward are a number of regulatory industry and regulatory changes, as well as favorable demographics within the country. As the new rules have been implemented over the last few years and as they continue to be added into the future, this changes the entire playing field in a very positive way.
Many experts feel that the main struggles in life insurance are behind the industry in the country.
This opens the doors to move on to a potential future in life insurance that will be considerably stronger than the struggles that were seen in the past. According to V. Minickam, the Life Insurance Council Secretary General, “With favourable demographics, new products launches on the anvil, industry expanding their operations and infusing efficiencies, the insurance industry will see significant growth in India.”
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Minickam also stated that his industry group also feels that the favorable demography – which is the population that is insurable with life insurance – is expected to grow significantly and that its life expectancy will have increased to 74 years old by fiscal year 2020. This will help to give the industry another important shot in the arm and will boost the appeal of its products to consumers.
Therefore, it has also been predicted that life insurance, which is currently the financial instrument that is second to the top in terms of consumer preference, will be sending the net household financial savings worth up to reach an estimated 35 percent of total savings by the year 2020. This compared to fiscal year 2010’s figure, which was a notably less significant 26 percent.