Insurance sector needs Rs. 50000crore each year; Insurers need to plough back profit: Panda

India’s insurance industry will need to infuse Rs 50,000 crore of capital every year in order to double penetration in the country, IRDAIchairman Debasish Panda said.

He also implored corporate conglomerates and investors to consider investing in the sector.

“If we have to double the penetration, every year there is need to infuse an additional Rs 50,000 crore. Some of it will come from the existing players itself by way of ploughing back their profits, some of it will come as an additional capital. After March, I intend to meet the chairpersons of all the insurance companies to drive home the point that they have to factor this and start planning to infuse more capital. I’m glad some players have already started around that,” Panda said while addressing at the CII organised Insurance and Pensions Summit.

Panda said India is set to become the sixth largest insurance market by 2032 from tenth largest currently but the country needs more investments if it has to achieve the insurance for all target set by the regulator by 2047.

“I will like to reach out to the conglomerates who are present in this country. Individual investors who are interested to invest their money. If you look at return on equity on the top 5 companies it is 20% and 16% on an average for non life and 14% for life insurance,” Panda said.

He also urged insurance companies to look at new opportunities and new coverages for insurance, the penetration of which are very low.