After a decade-long consistent growth, India's insurance sector faces a number of challenges presently, as a result of overpopulation, rising costs, slow growth of the industry and most importantly, stagnant regulatory framework. In Haryana, the insurance industry faces a number of key challenges. Let us ask what are the key concerns in the insurance industry in Haryana?
Haryana's burgeoning population along with the contrasting demographic structure is one of the key reasons why the insurance industry in the state is under-penetrated. While the presence of the elite sections in Haryana is visible, equally conspicuous is the rising number of poor people in the haryana, who live on a meagre agrarian production. In other words, the class-divide in society is very stark. This reduces the purchasing power of Haryana's middle-class and working-class population. Haryana must ensure that it encourages the purchasing capacity of the middle and working classes, by guaranteeing them employment in the different sectors.
Secondly, although Haryana is witnessing a great number of private companies entering the economy in the state, it must increase the efficiency and promote innovations for a competitive growth in the insurance industry. This can be improvised through good and transparent governance, constant and effective engagement and consultation between the companies and the industry, each of which is directed to serve the customers. Product range and product innovations must be enhanced to look into the needs of the customers.
For the insurance industry to prosper, one of the key concerns must be the orderly coordination between the insurance sector, the government and the various companies. This time-to-time consultation between these stake holders in the state of Haryana is even more crucial to balance the disparity in its socio-political milieu of the state. A concerted effort on the part of these three organs can channelise the industry's focus in order to ensure a more responsible and effective marketing and sales departments.
In both the life insurance and non-life insurance industries, Haryana must present products which appeal the most to the customers. Again, a standardised system of surveillance to improve fraud control mechanisms must be guaranteed to focus on maximising the profit margin in this industry. The persistent growth in some of the key insurance sectors, like motor insurance, in Haryana must be encouraged, so that it can lead to a moderating growth in the insurance industry.
As per the Confederation of Indian Industry (CII) in collaboration with Ernst and Young, the constant inflation in the country over the last couple of years, which has not only hit the GDP to an all-time low, but also increased the interest rates in various sectors, has led to the lacklustre condition of the insurance pool in Haryana. This can be regained by educating customers on financial awareness, so that they can enhance their savings in the insurance sector to a considerable extent.
On a final note, hopes are garnered on the insurance industry in Haryana. A vast potential in various segments of the market remains untapped, which if properly channelised, can lead to wonders in the state. The growth momentum, as envisioned by Naya Haryana, can be sustained if the key challenges in the insurance industry are met, as discussed above.