India could be home to the next wave of reinsurers, according to IRDAI Chairman T S Vijayan who is optimistic that the influx of foreign reinsurers into India and the establishment of new reinsurance hubs and government programmes to spur widespread re/insurance uptake could make India a local re/insurance hub.
With a large protection gap in vital services like motor insurance and health care, and socio-economic changes and technological advancements which make greater insurance uptake feasible, India is set with huge drivers of re/insurance industry growth.
T S Vijayan set out a vision to retain businesses within the country, saying; “maybe, down the lane, India could become a local reinsurance hub; so much can happen,” the Business Standard reported.
“Efficiency is not just collecting premium. How much has the industry integrated various analytics to understand the customer? This is where the next wave of growth and efficiency will come from.
“The next ten years will be the decade of insurance; it is going to lead the financial services sector and the total economy in many ways,” Vijayan said.
The Indian government has emphasized re/insurance growth in recent years, opening the market increasingly to foreign re/insurers and establishing ambitious government insurance growth programmes.
Reinsurance giant Swiss Re’s Global Business Solutions division in India recently signed a memorandum of understanding (MoU) with National Insurance Academy (NIA), to enable collaboration to develop re/insurance industry skills among professionals and students across India.
And with initiatives like these, together with newly relaxed capital rules that allow well-established Indian insurers to attract capital with an initial public offering (IPO) and the government increasingly opening the grounds to foreign reinsurers, the Indian re/insurance regulator’s Chairman’s hopes to establish a local re/insurance hub have a solid foundation to becoming a reality in coming years.
