New Delhi: India's insurance industry needs to innovate, simplify products and build trust amongst the customers through effective distribution claims management in order to ensure growth in the sector, a study said Sunday.
The study "Insurance industry - Challenge, Reforms and Realignment", conducted by Confederation of Indian Industry (CII), also said that the sector regulator also needs to phase in changes based on regulatory impact assessment, thereby giving industry time to adjust to the changed environment, along with initiatives to drive insurance awareness programmes.
"The insurance industry is faced with multiple challenges, while life insurance has seen de-growth in new business premium in financial year 2012, and non-life insurance is weighed down by underwriting losses," the study said.
"A multitude of changes in the regulatory landscape has given little time to the industry to adjust to changed market dynamics. Despite the challenges the insurance remains a market with huge potential with growth and emergence of individual lines of business like health," it added.
According to the study, as the economy, per capita and disposable incomes grow in the coming decades, the insurance industry is expected to grow as a channel for long term savings.
It also said that the role of the insurers, regulator and government is crucial and every one must work together towards sustainable profitable growth for the industry adding that the government may look at speeding the process of reforms to drive the growth as well.
According to the study, focus on protection and long term savings rather than investment, transparency of costs and riders and streamlining operations and transparency of costs attached, among other things that need to be worked on.