Life Insurance Penetration in Rural Areas-Indian Perspective

Reforms in the life insurance sector have opened up the growth of private players but still their reach in rural market is comparatively nascent. This potential that exists in the rural market is a great opportunity for the existing players. The scenario in rural India is dominated by Life Insurance Corporation of India, a public sector organisation. Private players are hesitant to enter rural market. This research attempts to explore the reasons for low penetration of private players in the rural market. Perception of the existing insurance policy holders and insurance agents in Bangalore rural and Kolar rural is studied. The descriptive research reveals that the existing insurance products are not designed for the rural segment. The promotional activities are inadequate and insurance companies donot concentrate on micro insurance policies. These are the major hurdles for the existing insurance players in the rural market.