History of Insurance in India
1818 saw the advent of life insurance business in India with the establishment of the Oriental Life Insurance Company in
Calcutta. This Company however failed in 1834.
In 1914, the Government of India started publishing returns of Insurance Companies in India.
The Indian Life Assurance Companies Act, 1912 was the first statutory
measure to regulate life business. In 1928, the Indian Insurance
Companies Act was enacted to enable the Government to collect
statistical information about both life and non-life business transacted
in India by Indian and foreign insurers including provident insurance
societies. In 1938, with a view to protecting the interest of the
Insurance public, the earlier legislation was consolidated and amended
by the Insurance Act, 1938 with comprehensive provisions for effective
control over the activities of insurers.
An Ordinance was issued on 19th
January, 1956 nationalising the Life Insurance sector and Life
Insurance Corporation came into existence in the same year. The LIC
absorbed 154 Indian, 16 non-Indian insurers as also 75 provident
societies—245 Indian and foreign insurers in all. The LIC had monopoly
till the late 90s when the Insurance sector was reopened to the private
sector.
General Insurance in India has its
roots in the establishment of Triton Insurance Company Ltd., in
1850 in Calcutta by the British. In 1907, the Indian Mercantile
Insurance Ltd, was set up. This was the first company to transact all
classes of general insurance business.
In 1972 with the passing of
the General Insurance Business (Nationalisation) Act, general insurance
business was nationalized with effect from 1st
January, 1973. 107 insurers were amalgamated and grouped into four
companies, namely National Insurance Company Ltd., the New India
Assurance Company Ltd., the Oriental Insurance Company Ltd and the
United India Insurance Company Ltd. The General Insurance Corporation of
India was incorporated as a company in 1971 and it commence business on
January 1sst 1973.
Following the
recommendations of the Malhotra Committee report, in 1999, the Insurance
Regulatory and Development Authority (IRDA) was constituted as an
autonomous body to regulate and develop the insurance industry. The IRDA
was incorporated as a statutory body in April, 2000. The key objectives
of the IRDA include promotion of competition so as to enhance customer
satisfaction through increased consumer choice and lower premiums, while
ensuring the financial security of the insurance market.
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Monday 15 July 2013
History of Insurance in India
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