Insurance business can be started in two forms such as Insurance agency or Insurance Carrier. The insurance agency typically sells a variety of insurance and financial products, including property insurance, casualty insurance, life insurance, health insurance, disability insurance and long-term insurance. While starting this business one should keep in mind to narrow down a particular sector rather than providing various types of insurance during the establishment of the company. Insurance business is an appealing business because it generates a residual income. Regulation for independent agencies vary from state to state with each state insurance commissioner offices overseeing its own regulatory and compliance.
While starting this business one must obtain various license and permits, which usually differ from state to state and country to country by abiding to their rules and regulation. Licensing is done in order to provide a legal entity for your company and then providing insurance plans in the market which requires a several levels of clearance to avoid frauds. So, by providing a proper business plan will ease the process little bit. Business plan helps the entrepreneur to understand, to visualize, to plan and to identify risks, even before making any investments in the business. Preparing a business plan involves detailed research so that all the aspects of the given business are evaluated and appropriate decisions are made.
This business is risky business so it’s better to have a experience of the market either by working as insurance agent or insurance broker or by doing a lot of research about the market and the opportunity and by gaining knowledge. The next big step is towards the funds, there is usually a huge amount of investment is required to operate the business and obtaining the funds or investment for the insurance company is really difficult. The other way of starting a insurance business by a buying a franchise which has a lower risk than an independent one.
The size of the insurance market is expected to quadruple in size over the next ten years. The current size of the market is $60 billion and it will rise to $160billion over ten years. The life insurance industry, during the year 2015-2016 recorded a growth od Rs. 1.38 trillion and growth rate of 22.5%, the general insurance industry also recorded a growth of $ 105.2 billion at 12% rate. Government of India has taken various initiative to boost the industry growth. India’s insurable population is anticipated to grow to 750 million in 2010.
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All organizations are made up of group of capabilities that are coming from People, Processes and Systems. These capabilities are working together in a seamless manner to deliver the requisite capabilities to the customer. The various capabilities that need to be addressed in a Insurance business plan are given below:
CEO, CCFO, COO, Board of Directors, Executive Committee, Audit Committee, Business Manager, based on the line of Business they are Categories as Commercial Insurance Account Executive, Commercial Agent / Broker, Insurance Agent / Broker, Investment Management Analyst / Associate, Strategist and Consultant, Life Insurance Agent / Broker, Risk Analyst / Associate, Reinsurance Analyst, Customer Service Representative, Investment Consultant, Application Processor.
Reserve Management, Investment Management, Operation Management, Accounting and Finance Management, Liquidity Management, IT Management, Operation Management, Risk Management, Compliance Management and policy Management.
Advanced computer software, Digital signature pads, Secured Online Database, Hand written document and they are stored in the electronic Database, Security module for both hardware and software.
Most of the businesses have professional bodies across the globe and being associated with these organizations tremendously helps in understanding the current trends in business. Some of the professional bodies are listed below for your reference:
The South African Insurance AssociationGround Floor, Willow brook House, Constantia Office Park, C/O 14th Avenue & Hendrik Potgieter Street, Weltevreden Park
Association of British InsurersOne America Square
17 Crosswall, London EC3N 2LB
Insurance Brokers Association of IndiaMaker Bhavan No.1, 7th Floor,
Sir V. T. Marg, Mumbai 400 020.
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