How to Underwrite Insurance in India
Insurance has a deep-rooted history in India, with ancient writings mentioning the pooling of resources for redistribution. The year 1818 saw the advent of life insurance, and the history of general insurance dates back to the Industrial Revolution. Outside of differences in the regulatory environment (see Resources), the actual process of underwriting insurance in India is not materially different from that in the U.S.
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Instructions
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Life and Health Insurance
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1
Verify age and income. Determine if the occupation could have health consequences.
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2
Find out the illness and personal accident history. Have a certified physican or medical center conduct a medical examination to determine any preexisting conditions.
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3
Assess the risk profile to determine a premium. Analyze the overall composition of the group, in the case of group insurance, to assess the aggregate risk and to ensure it is acceptable.
General Insurance
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4
Investigate the security arrangement of the apartment building or house in the case of homeowners or household property insurance. Make sure there are guards or security personnel to check entry and exit. Make a list of the insurable goods. Note the make, model and year of appliances, and the current market price of jewelry and ornaments.
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Note the make, model, production date, engine number and frame number of the vehicle, in the case of auto insurance. Verify whether the vehicle has changed hands. Ask the owner about any accidents. Due to the congestion on Indian roads, cars with dented frames and damaged taillights are a common sight. It may not be as easy to get access to records, since the Indian system of auto registration is not universally computerized.
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Visit the property, in the case of land or farm insurance, and make a preliminary evaluation to determine if it has been properly planned and certified. Ensure there are no legal hindrances to the ownership of the property. This could be a long process, since land registration records in India are often paper-based, so the search process is manual and time-consuming.
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Assess the risk profile to determine a premium.
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1
Tips & Warnings
Regulatory details on the Indian microinsurance and reinsurance industries is available on the IRDA website (see Resources).
U.S.-based corporations looking to expand or outsource certain kinds of insurance underwriting to India should be aware that local insurance industry growth has restricted the supply of skilled underwriters and actuaries.
References
Resources
- Insurance Regulatory and Development Authority: Insurers: Life: Guidelines
- Insurance Regulatory and Development Authority: Insurers: General: Guidelines
- Insurance Regulatory and Development Authority: Microinsurance: Regulations
- Insurance Regulatory and Development Authority: Insurers: Reinsurance: Guidelines
