Life insurance more common among Indian consumers than world average
The government of India has announced that the country’s residents have more coverage than the global median.
According to the latest data released by the government of India, residents of that country have a larger overall life insurance coverage than the global average in 2010.
The Minister of State for Finance Namo Narain Meena made the announcement in a written statement.
Within the announcement, Meena said that “Life insurance penetration in India was higher than the world’s average in 2010 and the combined average is higher than Brazil and Russia and most of other countries of Asia including Bangladesh, Pakistan, China and Sri Lanka.” He also added that “The government periodically receives proposals for providing tax incentives, inter alia, for investments in insurance and mutual funds and examination of such proposals is a part of an on-going process.”
In a different written statement from Meena, he said that there are no foreign life insurance companies.
At the moment, there is no international presence in India’s life insurance industry. That said, foreign insurers are legally permitted to enter into joint ventures with companies based in India, through partnerships with a 26 percent Foreign Direct Investment (FDI) cap. At the moment, there are 38 different private insurers that are operating in India within this type of joint venture partnership.
Mena has also previously explained that the Public Sector Banks (PSB) employee pay scales are set by way of an agreement that is made between the Associations/Unions and the management, which is renegotiated every five years. Within those negotiations, employees address not only pay, but also additional entitlements for allowances and benefits. The Central Government pay scale for its employees receives its finalization from the Government, which receives the recommendations of the Central Pay Commission. Those pay scales are typically reevaluated every decade.
All of this, as well as the wide awareness of the benefits of life insurance in India, have helped that industry to grow and to ensure a penetration among its residence that is notably higher than other countries around the world. Many additional changes are being made in the country to help to encourage the strength of this sector.