Summary |
Insurance is divided into two segment i.e. Life and non-life and each segment has developed independently. In this book only life insurance segment is discussed.
In 1870, two British life insurance companies entered India and attempted writing business on Indian lives. Subsequently, many Indian & foreign insurance companies started business in India and by the year 1955, there were 255 insurance companies operating in India and transacting business to the extent of Rs.200 crores. Due to the following reasons, the Govt. decided to nationalized the life insurance industry w.e.f. July 1, 1956
1. No full guarantee to the policyholders.
2. The concept of trusteeship was lacking.
3. Many insurance companies went into liquidation.
4. There were malpractices in the business.
5. Non-Spreading of life insurance
6. No rural Thrust
7. No group insurance
8. No social security
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