National Insurance Awareness Day is annually observed on 28th June to create awareness about Insurance which offers security in several situations and to make people aware of the benefits of investing in insurance plans.
- The day also encourages people to review their insurance plans and to check if all their insurance payments or renewals are up to date.
What is Insurance?
Insurance is a legal contract (a financial tool) between a person and an insurance provider, under which the individual pays a premium and, in exchange, the insurance company agrees to pay for specific care-related financial losses during the term of the policy.
History of Insurance in India:
i.With the establishment of Oriental Life Insurance Company in Calcutta in 1818, India witnessed the emergence of the life insurance business.
ii.The Government of India (GoI) started publishing returns of Insurance Companies in India in 1914.
iii.The Indian Life Assurance Companies Act, 1912 was enacted as the first statute to regulate the life insurance business.
iv.Life Insurance Corporation (LIC) of India was formed by an Act of Parliament (LIC Act, 1956), with a capital contribution of Rs. 5 crores from GoI.
Note: Insurance companies are required to have a minimum paid-up equity capital of Rs 100 crore.
Insurance penetration in India:
i.According to the Economic Survey 2022, Insurance penetration in India has seen a steady rise to 4.2% in FY21. it is measured as the percentage of insurance premium to Gross Domestic Product (GDP).
ii.Life insurance penetration in India stands at 3.2%, almost on par with the global levels of 3.3%, while non-life insurance stood at 1.0%, lagging the global penetration of 3.3%.
