India’s insurance regulator will issue more licences to encourage firms to join its general, health, and reinsurance industries and stimulate competition, reports say.
Despite both life and general insurance sectors posting positive growth, the Insurance Regulatory and Development Authority of India (IRDAI) admitted that there is more to be done, especially in general insurance.
“Today, compared to many other countries, our penetration as well as growth is good,” IRDAI chairman T S Vijayan, was quoted as saying by the Economic Times.
“But a lot needs to be covered, especially in the general insurance sphere. The penetration can be much higher than the current level,” Vijayan said at a conference organised by the Institute of Actuaries of India.
The regulator seeks to foster competition in the general insurance industry by increasing the number of firms, which will also deepen insurance penetration.
In September, IRDAI approved the licence of Acko General Insurance, the country’s first online general insurance company.
However, IRDAI also said that granting an insurance licence comes with the condition that investors are committed for the long term, and that funds continue to flow within the system to ensure sustainable growth.
“We want commitment for long-term investment from promoters getting in the insurance space,” said an IRDAI official in an earlier Economic Times report.