Impact of COVID-19 in India on Indian Insurance Sector

  • Indian insurance is generally well-equipped for major loss events, including pandemics. However, it will take some time for the financial implications to be fully understood by insurers. Insurance companies are responding to the COVID-19 pandemic on several fronts. Each has it's own discrete confront, not just for the insurance industry, nevertheless for the global economy and the public at large. CAUSES OF COVID 19

    A year that could have seen a remarkable year in the Indian insurance sector's premium growth is now suddenly facing an impossible task: harmonising the figures from the last year seems daunting. The most recent three months of financial years have conventionally been the months that observed peak collection for the industry.

    Premium collections are already suffering from the lockdown that took place in April's last week. This is due to the fact that many cities are currently under lockdown. Customers are unable to purchase travel insurance due flight cancellations. The lengthy process of buying new policies that require medical tests is time-consuming and can lead to delays. There is no more new policy issuance for NRIs or those with current travel history. In general, the insurance market has been impacted in multiple directions.

    The insurance industry is facing increased death claims and loss of business premiums. The government has taken positive steps and ordered a total lockdown for 21 days, even before the rise in death tolls to double digits. It is important to remember that the size of the country and early signs of community growth cannot be taken as a given. Insurance agencies feel it would be too early at this stage to remark on exponential augmentation in death claims in life insurance. India should be able to control the spread. If not, it could have a less severe impact on claims for life insurance. When it comes to life insurance policies there are a few companies that will still honor existing claims. The price of future policies will increase, and the number of policies with comprehensive coverage could fall. EFFECT OF COVID 19 ON EDUCATION