A Brief History of Insurance in India
21 Mar 2025
Insurance


Contrary to popular belief, insurance is not new to Indian culture. Some of our ancient manuscripts, dating as far back as 3000 B.C., introduce the idea of helping others in times of crisis. The concept of a "joint family" revolved around an informal insurance system—if a disaster struck, the community would come together to restore normalcy.
However, modern insurance as we know it today took root in India in 1818 with the establishment of the Oriental Life Insurance Company in Kolkata. The company primarily catered to Europeans, charging Indians significantly higher premiums. It wasn’t until 1870, with the Bombay Mutual Life Assurance Society, that Indians could access insurance at fairer rates.
General Insurance Arrives in India
While life insurance took its early steps in the 19th century, general insurance (covering property, vehicles, and businesses) gained prominence during the British era. The Triton Insurance Company was established in 1850 in Kolkata, marking the beginning of non-life insurance in India.
The Rise of Regulation (1912 - 1940)
By the early 1900s, insurance had grown in popularity, but it remained unregulated. In 1912, the Indian Life Insurance Companies Act was introduced, making it mandatory for insurance companies to be certified by an actuary.
By 1938, there were 176 insurance companies in India, and the Insurance Act of 1938 provided greater control to the government to protect policyholders.
Post-Independence and Nationalization (1940 - 1970)
After India's independence, insurance underwent massive changes:
1956: Life insurance was nationalized, and all private life insurers were merged into the Life Insurance Corporation of India (LIC).
1972: The General Insurance Business Nationalization Act was passed, consolidating 107 general insurers into four major public sector companies:
New India Assurance Company
National Insurance Company
Oriental Insurance Company
United India Insurance Company
Liberalization and Privatization (1990 - 2000)
The 1990s saw a wave of economic liberalization. The Malhotra Committee (1994) recommended opening the insurance sector to private players, leading to the 1999 introduction of the Insurance Regulatory and Development Authority (IRDA).
This paved the way for private companies and foreign joint ventures to enter the Indian insurance market, marking the beginning of modern insurance in India.
The Present and Future of Insurance in India
The 21st century has seen tremendous growth in India's insurance sector, with over 24 life insurance companies and 34 general insurance providers.
Some key trends shaping the industry include:
Digitization: Buying and managing insurance online has become easier than ever.
New Insurance Products: The Indian government has launched schemes like Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Corona Rakshak, making insurance more accessible.
Increased Reserves: To combat economic fluctuations, insurers are strengthening their financial reserves.
Conclusion
The insurance sector in India has evolved from a colonial-era privilege to a vital part of everyday life. While challenges like low penetration and awareness persist, digital transformation and policy changes continue to make insurance more inclusive.
At Assurekit, we’re working towards making insurance accessible and user-friendly for businesses and consumers alike.
Contrary to popular belief, insurance is not new to Indian culture. Some of our ancient manuscripts, dating as far back as 3000 B.C., introduce the idea of helping others in times of crisis. The concept of a "joint family" revolved around an informal insurance system—if a disaster struck, the community would come together to restore normalcy.
However, modern insurance as we know it today took root in India in 1818 with the establishment of the Oriental Life Insurance Company in Kolkata. The company primarily catered to Europeans, charging Indians significantly higher premiums. It wasn’t until 1870, with the Bombay Mutual Life Assurance Society, that Indians could access insurance at fairer rates.
General Insurance Arrives in India
While life insurance took its early steps in the 19th century, general insurance (covering property, vehicles, and businesses) gained prominence during the British era. The Triton Insurance Company was established in 1850 in Kolkata, marking the beginning of non-life insurance in India.
The Rise of Regulation (1912 - 1940)
By the early 1900s, insurance had grown in popularity, but it remained unregulated. In 1912, the Indian Life Insurance Companies Act was introduced, making it mandatory for insurance companies to be certified by an actuary.
By 1938, there were 176 insurance companies in India, and the Insurance Act of 1938 provided greater control to the government to protect policyholders.
Post-Independence and Nationalization (1940 - 1970)
After India's independence, insurance underwent massive changes:
1956: Life insurance was nationalized, and all private life insurers were merged into the Life Insurance Corporation of India (LIC).
1972: The General Insurance Business Nationalization Act was passed, consolidating 107 general insurers into four major public sector companies:
New India Assurance Company
National Insurance Company
Oriental Insurance Company
United India Insurance Company
Liberalization and Privatization (1990 - 2000)
The 1990s saw a wave of economic liberalization. The Malhotra Committee (1994) recommended opening the insurance sector to private players, leading to the 1999 introduction of the Insurance Regulatory and Development Authority (IRDA).
This paved the way for private companies and foreign joint ventures to enter the Indian insurance market, marking the beginning of modern insurance in India.
The Present and Future of Insurance in India
The 21st century has seen tremendous growth in India's insurance sector, with over 24 life insurance companies and 34 general insurance providers.
Some key trends shaping the industry include:
Digitization: Buying and managing insurance online has become easier than ever.
New Insurance Products: The Indian government has launched schemes like Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Corona Rakshak, making insurance more accessible.
Increased Reserves: To combat economic fluctuations, insurers are strengthening their financial reserves.
Conclusion
The insurance sector in India has evolved from a colonial-era privilege to a vital part of everyday life. While challenges like low penetration and awareness persist, digital transformation and policy changes continue to make insurance more inclusive.
At Assurekit, we’re working towards making insurance accessible and user-friendly for businesses and consumers alike.

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Assurekit is a full-stack digital insurance platform built for growth, that enables anyone to create, sell and manage contextual insurance products in a plug-and-play manner



©2024 Assurekit technology & service pvt ltd

Assurekit is a full-stack digital insurance platform built for growth, that enables anyone to create, sell and manage contextual insurance products in a plug-and-play manner



©2024 Assurekit technology & service pvt ltd

Assurekit is a full-stack digital insurance platform built for growth, that enables anyone to create, sell and manage contextual insurance products in a plug-and-play manner



©2024 Assurekit technology & service pvt ltd