Investment Market of Insurance Business: Does it Need more Attention in India?

The unforeseeable and uncertain events such as the coronavirus pandemic have enhanced the importance of the insurance industry and its growth in the coming years. This paper focuses on the insurance industry and how it has the potential to perform in the investment sector by involving investors in fundraising and insurers in continuing to further invest in assets for the operation and growth of the industry. It tries to draw a line between an insurance policy and an investment, arguing that an insurance policy is not an investment, and in today's emerging market of insurance products, it makes sense to invest in the insurance industry. It underlines and analyses the regulatory framework of investment, involving raising of capital through not only with equity shares but also from other forms of capital, investment by insurers in government securities, approved investments, and household finance, and lastly, investment by foreign investors with a welcome change of 100% FDI in Insurance Intermediaries. It attempts to underline the problems faced in the investment due to excessive norms on the foreign investors, less investment by insurers, obscured regulatory authority of insurance-cum-investment products, and the nature of these products to fall under the definition of securities. It tries to fill the gaps by concluding that the industry needs more attention in the capital market, in the protection of insurance investors and changes in the regulatory reforms and participation of investors in the industry will lead to the contribution of the industry in the investment market of India.