Main Article Content
Abstract
Risk is an integral element of business and life in general. However, assumption of risk allows exploitation of the potentials of economic activities. In this context, the insurance sector plays a vital role in economic development of a country. Not only does insurance provide security against possible losses but the monetary resources mobilized by the sector acts as a source of long term finance to industry and infrastructure development. The insurance sector in India, comprising life and general insurance, has been historically government owned even after the introduction of liberalization measures for the rest of the economy. It was only in the year 2000 that the insurance sector, life and general, was opened up for the private sector. Foreign Direct Investment limit for the sector was liberalized from 26 percent to 49 percent only in 2014. Resultant to these developments, the number of life insurance companies increased from one to 24 over a period of time, while the total number of firms in the life and non-life segment together count to 57. The present study undertakes an examination of changes in the life insurance sector in India after liberalization of the sector. It inquires into how much privatization of the sector has happened after opening up of the sector to private investment.