HYDERABAD: The recently launched Prime Minister’s Jan Dhan Yojana was an instant hit as the bank accounts opened via this scheme came with insurance products, according to according to T S Vijayan, Chairman, Insurance Regulatory and Development Authority (IRDA).
“...otherwise this scheme couldn’t have been so successful,” he said.
Addressing a gathering at the convocation ceremony of the Indian Institute of Risk Management, here on Wednesday, Vijayan said the sector was attracting investors even while insurance companies were making losses.
“FDI in insurance is being debated much more prominently than the similar proposals in the strategic sectors like defence as if bringing capital is going to solve all the problems faced by the industry,” he said adding, “It is the purpose of capital that is important and not the capital itself. Some even hold the view that we don’t need capital at all.”
A select Parliament committee meeting on the Insurance Bill to raise the FDI limit from the current 26 to to 49 per cent is slated for Thursday.
The insurance sector needs thrust on marketing and trained personnel other than foreign direct investment, he said.
Recalling the time when the Government infused `5 crore capital in Life Insurance Corporation way back in 1956,Vijayan said, it was for the purpose of collecting the dividend.
“There are initiatives like selling insurance through CSCs, but unless numbers are there, it isn’t a success. Marketing policies is required and customers need customised products, whose income levels are higher, while keeping the generic products for entry-level customers, if penetration has to go up to a particular level,” he said.
Meanwhile, Chitra Ramakrishna, Managing Director and Chief Executive of the National Stock Exchange, said there was heightened risk among enterprises and this risk goes beyond financial risks. “The time to respond to these risks is shortening and it is critical to respond quickly to these risks,” she said.