With the advent of electronic vehicles the future of the Motor Insurance market in India is set to change drastically. With the scarcity of Petroleum products and dominance of few countries in supplying petrol, countries are aggressively looking for alternative technology/options like electric vehicles, alternate cheaper fuels, solar powered or any other similar technology. May be down the line after 10-15 years the vehicle insurance market may transform completely.
The government is giving a lot of push for E vehicles which will help to save rising fuel costs, low maintenance, more longevity, and cheaper vehicles. Once the e-vehicles dominate the Indian market, the scenario of vehicle insurance may also transform completely. The cost of insurance will decrease, servicing cost will decrease and costs of parts will reduce. Currently Motor insurance contributes a significant amount to the general insurance portfolio. The general insurance industry must undertake continuous research and development in this area to understand the possible disruption in the market and frame strategies accordingly.
Climate Change is another area which needs serious consideration by the Insurance Industry. Climate change has already started to impact us in a big way and moving forward the intensity will continue to increase. As the businesses and economies get impacted, the insurance industry too will feel the heat. The size and frequency of claims will rise with a lot of unpredictability and uncertainty. Insurance Companies and regulators must invest sufficient resources for research in the area of climate change as this may alter the whole dynamics of insurance business.
IRDAI is still headless with the retirement of earlier chairman Mr. S C Khuntia. The succession planning should be done, way ahead of possible vacancy. It has been seen that the government is taking a lot of time in filling up top posts.
