International Journal of Applied Research
Vol. 2, Issue 4, Part B (2016)
Economic reforms and its impact on the insurance industry in India
Economic reform usually refers to deregulation, or at times to reduction in the size of the government, to remove distortions caused by regulations or the presence of the government. The process of economic reforms was born out of the crisis in the Indian economy which occurred in 1991. This mis-happening compelled the government to adopt a new path-breaking economic policy under which a series of economic reform measures were undertaken not only with the objective to deal with the crisis but also to take the economy on a high growth path. Liberalization and deregulation seek to improve economic welfare by bringing more efficient allocation of resources in the long run. As a consequence, dozens of countries have deregulated and liberalized their insurance markets. Insurance sector in India has also gone through the process of reforms following the recommendations of Malhotra Committee’s report submitted in 1994. The insurance industry in India has passed through a period of structural changes under the combined impact of financial sector reforms in general and insurance sector in particular. With the liberalization of insurance sector, the paradigm for Indian insurance industry has witnessed a sea change during the last decade. In this paper an attempt has been made to analyze the overall performance of the insurance industry in India. The results show that there has been a tremendous improvement in the overall performance of the insurance sector in India, particularly in terms of insurance density and penetration.
How to cite this article:
Seharish J Ansari, Amir Rehmani. Economic reforms and its impact on the insurance industry in India. Int J Appl Res 2016;2(4):121-124.