Impact of Global Financial Crisis on Insurance Industry

The global financial crisis affected the entire financial services industry. The insurance industry was no exception, particularly with the global giant in the industry, AIG, badly affected by the crisis and receiving extensive government support. The business generated by the life insurance industry in 2008 was substantially lesser than that generated in 2007. The life insurance industry, which was growing at around 30% in 2006 and 2007, was affected by the global meltdown. The industry revenues fell sharply, resulting in a negative year-on-year growth of 56% in 2009. This article examines the impact of the global financial crisis on the Indian insurance Industry. The macroeconomic drivers influencing insurance business have been identified to forecast the business revenue for the industry.