Investment Analysis of an Insurance Company

Abstract

The purpose of this project is to understand the working of insurance companies. As one of the largest markets of insurance, India has the least insurance market penetration. And with this it has big potential to grow and with the market growing and increased awareness, the penetration is increasing year to year. Along with this, there is an increase in the premium collected and policies sold. But what major people of these policies does not know is how their money is invested and how safe these investments are. So, with help of these project, light on the investment pattern on insurance companies will be shed. With 24 life insurance companies and 34 non – life insurers, all being regulated by IRDAI – Insurance Regulatory and Development Authority of India, and they had always issued and updated the regulations for these insurance companies so that they can invest people’s money in safe investments. For this purpose of knowing investment structure, details of latest regulation from IRDAI, industry average of both life insurers and non – life insurers and investment structure of LIC was taken into consideration. For the calculation purpose the Annual Report of IRDAI for the year 2019-20 was taken into account. The data related to whole industry and each company can be found in that report. With all the guidelines are predefined and all the companies had to stick with them, there are no much difference between the industry average and individual companies, the report focuses on minor difference between the companies and the security of these investments. In this report, the reason why these securities are selected by IRDAI and Insurance Companies for the purpose of investment would also be discussed. Along with this, there would be glimpse of financial sector will be there which includes banking, insurance and financial services.