Regulatory Framework For Insurance In India

Abstract

The history of insurance can be traced back to the Great Fire of London in 1666, which destroyed over 13,000 homes. The devastating consequences of the fire prompted the establishment of insurance as a top priority. Insurance has come a long way since then, and it is now a highly refined risk management tool. The primary aim of insurance is to shield people from unforeseeable incidents that could be harmful to them. Insurance is a type of risk management in which the insured passes his potential future loss to another company in exchange for a payment called a premium, and the insurer agrees to pay the insured a certain sum of money if a defined occurrence occurs. As a consequence, insurance is a type of contract or agreement in which one party agrees to pay a negotiated sum of money to another party in exchange for a consideration to compensate for the loss, harm, or injury to something of value in which the insured has an interest. The insurance industry has become the most rapidly expanding sector in a relatively short period of time. Insurance is a must because the future is always uncertain, and one should always be prepared for the worst. Insurance provides a sense of protection to a person or a business organisation against any significant loss or financial challenges that they might have to face as a result of changes in future events. Property insurance has become a necessary function of modern society to protect against the financial effects of its failure or injury. Individuals and companies are covered and supported by insurance, which is a vital component of society. It promotes trade and exchange, creates jobs, shares risk, and promotes creativity by encouraging individuals and businesses to participate in more risky business practises. The Legal Framework for Insurance Disputes in India is discussed in this article, as well as whether changes in the Regulatory Framework of Insurance Policies as a result of the Pandemic. Data Protection in the Insurance Sector in India has also been debated, which is something that needs to be taken into account when dealing with insurance laws.