Finance Minister P.Chidambaram Monday suggested the insurance regulator expedite the move towards launching three-year motor third party insurance policy to reduce the number of uninsured vehicles on the road, said an official statement.
He also suggested to the Insurance Regulatory and Development Authority (IRDA) to look at implementing the compulsory third party insurance with its powers and review the premium rates.
Chidambaram also drew attention to the need for IRDA to create standard templates to facilitate insurance companies quickly launching new products on a "use and file" basis.
Some progress has been made on the life side, which needs to be expanded and emulated on the non-life side, said the finance ministry statement after Chidambaram met the heads of all the public sector insurance companies - life and general - and IRDA chief T.S.Vijayan here.
According to the statement, the government owned general insurers have shown a growth of 10 percent in gross premium during 2013-14 and projected a growth of 100 percent in the next five years.
Profitability of the public sector general insurance companies has also improved in 2013-14.
Referring to the decline in their market share last fiscal, Chidambaram advised the companies to ensure that it does not go down further from the current level of 53 percent and improve upon it.
The statement said the 18 percent growth of Life Insurance Corporation's first year premium last fiscal as against 11.57 percent growth logged by the industry was noted with satisfaction.
The market share in number of new policies sold has also gone up during the period by 1.20 percent to 84.44 percent.
At the meeting, Chidambaram stressed the need to study the persistency ratio for unit linked and traditional polices separately.
It was noted that LIC maintained its excellent claim settlement track record with 99.3 percent settlement of death claims and 99.68 percent maturity claims.