The Role of Micro Insurance in India

Considering the socio economic plight of the people of India with one fourth of them under poverty line and a vast majority living in rural areas vulnerable to numerous perilous risks, the importance of micro insurance-an insurance which focuses on the protection of the people at the lower strata of the society-need not be over emphasised. The foregoing analysis brings out the bleak picture of Indian Insurance industry with regard to Insurance Penetration, Density and Coverage which is much below world average and of many Asian countries. The insurance industry is still at nascent state in India even after centuries of operational tradition. In life insurance segment about 77 seven percent and in General Insurance sector about 87 percent of the population remains without any insurance coverage. However thanks to IRDA regulations a sea change is occurring in micro insurance. There is now large potential for micro insurance players to chip in with innovative products and services to tap myriad of opportunities in the segment of micro insurance at the lower strata of the society leading to protection against risk of loss of life and property of the hapless people there at the bottom. This of immense socio economic significance in a country like India where one fourth of the masses lie below poverty line and most of them are vulnerable to numerous perils.