Insurance and Risk Management — Present, trends and opportunities

Human Life is full of uncertainties.

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It's almost impossible to predict what can happen to us in the next moment. Even in the word “LIFE” itself, on removing first and the last alphabets, “IF” remains. To address the financial losses arising out of these uncertain events in the future, we do require some sort of mechanism to mitigate our financial risk. To address this uncertainty, Insurance is a one tool to replace an uncertainty with a certainty.Modern insurance originated in 1680's from the Llyod café London in the form of Marine insurance, where the Ship owners, Merchants used to meet and discuss their sea voyages and the various risk involved.

In today’s progressive world, it’s quite difficult to think without insurance. Every expedition to Moon & Mars is insured, the discounted crude oil we are getting has insurance protection and not only this, but the cricket matches are also being insured to safeguard the organizers.

Few years back, Bollywood actor late Irfan Khan used to come in one of the promos of an insurance company and says that in India, we have a disease of taking lower Sum assured policies. The Insurance penetration of 3.7 % (Insurance premium to the GDP) says it all. As per the Swiss Re 2021 report, we have a Mortality protection Gap of 87% in India and potentially reaching a premium volume of 106.8 Billion by 2023. It's a huge gap, reflecting that most of our losses are uninsured.