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New Delhi: Companies should design their policies keeping in mind increasing the reach of insurance to more population. This statement was given by M. Nagaraju, Secretary, Department of Financial Services (DFS).

Emphasizing the need to expand insurance coverage to a larger section of the population, he advised companies to give priority to covering more and more individuals under the insurance net rather than focusing primarily on larger policies.

Nagaraju gave this advice in a meeting convened to comprehensively review the vision strategy documents of three public sector insurance/reinsurance companies – Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC) and Oriental Insurance Company Limited (OICL).

According to a Finance Ministry document, companies were advised to formulate investment and insurance strategies to reduce the loss ratio. The key areas discussed included development of new products, enhancement of digital and technological capabilities while adhering to the prescribed cyber security frameworks, expansion of insurance services through online platforms, timely resolution of public complaints, expansion of distribution network and enhancing communication and promotion through various platforms including social media.

Medium term (three years) and long term (five years) vision strategy documents were reviewed during the meeting. The DFS Secretary presented strategic guidelines aimed at increasing operational efficiency and strengthening financial stability, while also emphasizing the importance of promoting sustainable development.

Instructions have also been issued to further develop human resources and information technology strategies to improve overall service delivery, the statement said. Meanwhile, the central government has notified 100 per cent foreign direct investment (FDI) in the insurance sector under the automatic route, opening the way for greater participation by foreign investors.

Foreign investment in insurance companies will be subject to compliance with the provisions of the Insurance Act, 1938 and obtaining mandatory approval from the Insurance Regulatory and Development Authority of India (IRDAI) for insurance and activities.