Fire, insurance compliance not just an education issue

When such presentations are made, there is plenty of effort given in the direction of uplifting education in that regard, that people ought to grasp the vital importance of being insured, though the focus is unavoidably less of personal assurance but its ethical parameter. There is a risk to each individual, which all of us care about, but insurance is about helping each other out and thus cancelling the dangers of risk generally, which is slightly more complicated.

Plenty of water has passed under the bridge since the country moved from monopoly insurance by the National Insurance Corporation (NIC) into a market environment, but for all intents and purposes a vibrant insurance market is yet to kick off. 

While there are sector differences for instance the way telecommunications has been growing with a bang, and more reserves spheres like insurance, it is difficult to hide a performing sector or batch of companies as it would always shine. There is a public image where insurance is rather cramped or stymied, and experts tend to be interpreting that situation in terms of education, whereas it is the benefits that must come first.

There is a similar problem with fire insurance but its compliance level is higher owing to the fact that it is more amenable to forceful compliance or energetic measures to that effect. Still there is an aspect of fire insurance compliance which boils down to insurance take up level, as it isn’t compliance where it is voluntary, as in life insurance (which covers most property insurance outside the fire fighting element per se). When one has a shop frame or a corner shop, neither the third party nor fire-dousing equipment installation applies, but the street trade is as vulnerable to fire ravages or other forms of property risk as everyone else. It isn’t education alone that counts.

The question that comes up is what happens before someone decides to make a visit to a nearby insurance agency office to take up a voluntary policy, for instance on account of having a shop, or just a house in the neighbourhood. 

Fire-dowsing equipment installation isn’t compulsory for houses but is strongly advised, while traders’ fire risk is equally an insurance eligible situation but is also not compulsory. Trying to make such compliance mandatory risks raising the public ire, as it breaches the common sense law of letting people take care of their own risks, that ‘big brother’ will not compel everyone to do the right thing, including mandatory insurance take up.

Looking at the issue from the viewpoint of voluntary compliance, what comes to mind is the whole issue of peer pressure, as to what sort of environmental and social pressure comes up for a trader to take up insurance, or a home owner. Essentially it is tied up with things like bank credit or rental needs, in that a house with fire dousing equipment will attract a well paying client, and also a shop owner with insurance cover is likely to obtain credit from a microfinance facility for instance. 

When such auxiliary facets of commercial interactions are missing or diminishing, the level of interest at individual level to take up voluntary insurance is eroded as safety or value is taken for granted, due to rarity of fire, etc. And paying insurance looks like a net loss, wrongly…