{"id":72565,"date":"2026-04-30T18:14:43","date_gmt":"2026-04-30T12:44:43","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=72565"},"modified":"2026-04-30T18:15:46","modified_gmt":"2026-04-30T12:45:46","slug":"insurance-for-all-social-security","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/30-04-2026\/insurance-for-all-social-security","title":{"rendered":"Insurance for All: Expanding Coverage, Strengthening Social Security"},"content":{"rendered":"\n<p><strong>Syllabus: GS3\/ Economy<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>The Insurance Regulatory and Development Authority of India<\/strong> has set the vision of <strong>\u201cInsurance for All by 2047\u201d, <\/strong>aiming for comprehensive coverage across life, health, and property segments.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Insurance Sector Performance in India<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India has emerged as the <strong>10th largest insurance market<\/strong> globally with a share of <strong>1.8%<\/strong> in global<strong> premium volumes.<\/strong><\/li>\n\n\n\n<li><strong>Insurance penetration <\/strong>in India stands at 3.7%, with life insurance contributing 2.7% and non-life insurance contributing 1%.\n<ul class=\"wp-block-list\">\n<li><strong>Health insurance <\/strong>has emerged as the leading segment within non-life insurance, contributing 41% of gross domestic premium.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Insurance density<\/strong> has increased to <strong>USD 97,<\/strong> reflecting gradual expansion in coverage.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img data-dominant-color=\"92cadf\" data-has-transparency=\"false\" loading=\"lazy\" decoding=\"async\" width=\"575\" height=\"454\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2026\/04\/image-184.png\" alt=\"\" class=\"not-transparent wp-image-72566\" style=\"--dominant-color: #92cadf; width:403px;height:auto\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2026\/04\/image-184.png 575w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2026\/04\/image-184-300x237.png 300w\" sizes=\"auto, (max-width: 575px) 100vw, 575px\" \/><\/figure>\n<\/div>\n\n\n<p><\/p>\n\n\n\n<div class=\"wp-block-group has-background\" style=\"background-color:#fff2cc\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p><strong>Key Terms<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Insurance penetration <\/strong>is defined as gross premiums written for direct life and non-life insurance business as a percentage of GDP.<\/li>\n\n\n\n<li><strong>Insurance density<\/strong> is the ratio of premiums to population (per capita premium).<\/li>\n\n\n\n<li><strong>An insurance premium<\/strong> is the amount paid by an individual or business to obtain an insurance policy.<\/li>\n\n\n\n<li><strong>The premium varies<\/strong> across policyholders, as it is determined by several influencing factors, such as <strong>age, area of residence, nature of employment, medical ailment, income<\/strong> and others.\u00a0<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<p><\/p>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Significance of Insurance in the Economy<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Financial Continuity: <\/strong>Insurance ensures financial stability by protecting households from income shocks and preventing distress sale of assets.<\/li>\n\n\n\n<li><strong>Support to Investment: <\/strong>Insurance reduces uncertainty and provides risk mitigation, thereby encouraging entrepreneurship and business investments.<\/li>\n\n\n\n<li><strong>Capital Formation: <\/strong>Insurance promotes long-term savings and contributes to capital formation, supporting economic growth.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Major Government Insurance Schemes<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Pradhan Mantri Jeevan Jyoti Bima Yojana: <\/strong>The scheme provides life insurance cover of <strong>\u20b92 lakh<\/strong> at an affordable annual premium, ensuring financial protection to families in case of the death of the insured.<\/li>\n\n\n\n<li><strong>Pradhan Mantri Suraksha Bima Yojana: <\/strong>The scheme provides accidental death and disability coverage at a nominal premium, making it accessible to economically vulnerable sections.<\/li>\n\n\n\n<li><strong>Employees State Insurance Scheme:<\/strong> The scheme provides comprehensive social security covering sickness, maternity, disability, and employment injury.<\/li>\n\n\n\n<li><strong>Pradhan Mantri Fasal Bima Yojana: <\/strong>The scheme provides comprehensive crop insurance <strong>against natural risks<\/strong>, ensuring income stability for farmers.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Policy and Regulatory Measures in Insurance Sector<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>The Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025<\/strong> has amended various provisions of the Insurance Act, 1938, the Life Insurance Corporation Act, 1956, and Insurance Regulatory and Development Authority Act, 1999, to strengthen the insurance ecosystem.\n<ul class=\"wp-block-list\">\n<li>The amendment <strong>raises the FDI limit<\/strong> in Indian insurance companies from <strong>74% to 100%.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>GST exemption <\/strong>is granted on all individual life insurance policies and health insurance policies (including family floater) along with reinsurance <strong>w.e.f. 22 September, 2025.\u00a0<\/strong>\n<ul class=\"wp-block-list\">\n<li>The removal of the <strong>18% GST<\/strong> lowers premium costs and encourages wider adoption.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Shortening of Moratorium Period: <\/strong>Moratorium period in health insurance is a fixed timeframe after which insurance companies cannot deny claims on the grounds of non-disclosure and misrepresentation, except on grounds of established fraud.\n<ul class=\"wp-block-list\">\n<li>IRDAI reduced the moratorium period from <strong>8 years to 60 months (5 years) in 2024.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Standardized 30-day free-look period: <\/strong>IRDAI introduced a standard <strong>30-day free-look-period<\/strong> for policies with a term of one year or more.\n<ul class=\"wp-block-list\">\n<li>The free-look-period is the period given to a policyholder to assess and review the policy document.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Grace Period for delay in premium payment:<\/strong> A grace period of <strong>15 days<\/strong> (where premium is paid on a monthly installments) and<strong> 30 days <\/strong>(where premium is paid in quarterly\/half yearly\/annual installments) is available on the premium due date, to pay the premium.<\/li>\n\n\n\n<li><strong>Premium Refund on Mid-Term Cancellation:<\/strong> In case of mid-term cancellation of the policy, insurers shall refund the premium or proportionate premium for the unexpired policy period.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges Faced by the Insurance Sector<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Low Penetration:<\/strong> Insurance penetration remains low at <strong>3.7%,<\/strong> indicating inadequate coverage compared to the global average (7.3% in 2024).<\/li>\n\n\n\n<li><strong>Claims Settlement Issues:<\/strong> Delays and <strong>lack of transparency<\/strong> in claim settlements reduce customer trust in insurance services.<\/li>\n\n\n\n<li><strong>Distribution Limitations: I<\/strong>nsurance distribution is<strong> largely urban-centric,<\/strong> limiting access in rural and remote areas.<\/li>\n\n\n\n<li><strong>Affordability Constraints:<\/strong> High premiums make insurance products less accessible for low-income households.<\/li>\n\n\n\n<li><strong>Fraud and Mis-selling: <\/strong>Fraudulent claims and mis-selling practices by intermediaries undermine consumer confidence.<\/li>\n\n\n\n<li><strong>Rising Costs:<\/strong> Increasing medical and claim costs are raising premiums and affecting insurer profitability.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<div class=\"wp-block-group has-background\" style=\"background-color:#ebecf0\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p><strong>Insurance Regulatory and Development Authority of India (IRDAI)<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>IRDA was constituted in <strong>1999<\/strong> as an <strong>autonomous body<\/strong> after the recommendations of the <strong>Malhotra Committee report<\/strong> to regulate and develop the insurance industry.\n<ul class=\"wp-block-list\">\n<li>It was incorporated as a<strong> statutory body<\/strong> on April 19,<strong> 2000.\u00a0<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>The Authority has the power to frame regulations under<strong> Section 114A of the Insurance Act, 1938.<\/strong><\/li>\n\n\n\n<li><strong>Objective:<\/strong> The main objective of the IRDA is to protect the interests of the policyholder and regulate the insurance industry.\u00a0<\/li>\n\n\n\n<li>IRDAI is under the jurisdiction of the <strong>Ministry of Finance,<\/strong> Government of India.<\/li>\n\n\n\n<li>It has framed regulations ranging from registration of companies for carrying on insurance business to protection of policyholders\u2019 interests.<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<p><\/p>\n\n\n\n<p><strong>Source: <\/strong><a href=\"https:\/\/www.pib.gov.in\/PressNoteDetails.aspx?id=158322&amp;NoteId=158322&amp;ModuleId=3&amp;reg=5&amp;lang=1\" target=\"_blank\" rel=\"noopener\"><strong>PIB<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong> Context <\/strong><\/p>\n<li class=\"ms-5\"> The Insurance Regulatory and Development Authority of India has set the vision of \u201cInsurance for All by 2047\u201d, aiming for comprehensive coverage across life, health, and property segments. <\/li>\n<p><\/p>\n<p><strong> Insurance Sector Performance in India <\/strong><\/p>\n<li class=\"ms-5\"> India has emerged as the 10th largest insurance market globally with a share of 1.8% in global premium volumes. <\/li>\n<li class=\"ms-5\"> Insurance penetration in India stands at 3.7%, with life insurance contributing 2.7% and non-life insurance contributing 1%. <\/li>\n<li class=\"ms-5\"> Health insurance has emerged as the leading segment within non-life insurance, contributing 41% of gross domestic premium. <\/li>\n<p><a href=\" https:\/\/www.nextias.com\/ca\/current-affairs\/30-04-2026\/insurance-for-all-social-security \" class=\"btn btn-primary btn-sm float-end\">Read More<\/a><\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-72565","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/72565","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=72565"}],"version-history":[{"count":2,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/72565\/revisions"}],"predecessor-version":[{"id":72568,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/72565\/revisions\/72568"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=72565"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=72565"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=72565"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}