The 18 graduating students of the Institute of Insurance and Risk Management (IIRM) on Friday had a lesson that was probably as relevant as any they had during their one-year course. And it was: to focus on the 600 million population base and the constraints under which they live, in designing products or services.
In his convocation address at IIRM, Insurance Regulatory and Development Authority (Irda) chairman J Hari Narayan said the real challenge before them was to work out ways to expand insurance and other services to the 600 million people who were not in focus so far.
“Practices differ across the world, but we need to pay attention to where we stand,” he told the students. The graduating students are the new recruits of ICICI Prudential Life Insurance and the third batch of IIRM's executive programme in insurance and risk management.
Sandeep Bakshi, managing director, ICICI Prudential Life Insurance (IPLI), said in the last 12 years, the services industry which revolved around the 300 million strong middle class had done well. But in future, it would be services that emancipate the rest of the population that are needed.
According to Bakshi, the financial sector on average grows at a rate two- or three-times the GDP growth rate, and the insurance sector specifically was set to reach a size of Rs 20 lakh crore by 2020 from the current Rs 13 lakh crore. In this context, right product, right distribution architecture and overall consumer focus were the aspects that need attention, he said. The executive programme was a result of a three-year MoU between IIRM and IPLI signed in 2008, according to Vepa Kamesam, managing director, IIRM.
The insurance industry employs 3 million agents, of which 2 million are active and some 700,000-800,000 are very active, according to Hari Narayan. Apart from agents, the industry employs 150,000-200,000 officers.