Long before the modern insurance industry took shape, the idea of risk-sharing and collective protection had deep roots in Indian society. Traditional Indian communities practised forms of mutual aid and collective responsibility—be it village-level grain banks, caste-based welfare pools, or religious endowments used to support families during illness or death. These indigenous risk-mitigation mechanisms were informal, trust-based, and socially embedded. They may not have carried actuarial sophistication, but they carried moral clarity. Protection was seen as a collective ethic, not a product to be sold.Colonial HangoverThe colonial period introduced new ideas of insurance, largely to safeguard the interests of the empire and its mercantile ventures. Over time, this gave rise to a nascent domestic insurance sector, which gained scale during the post-Independence period through nationalisation. Life Insurance Corporation, established in 1956, and later the General Insurance Corporation, became synonymous with state-backed financial security. For decades, these institutions occupied near-monopolistic roles, offering basic protection with a public-service ethos, albeit with limited consumer choice or competition.
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