Forecasting Gross Premium in India: Comparative ARIMA Model Analysis for New India Assurance

Abstract

This research assesses the predictive efficacy of ARIMA models for projecting Gross Premium Collected in India (GPI) by New India Assurance. The study utilizes historical data from 2002 to 2023 and includes stationarity testing, model selection, and residual diagnostics. The study designates ARIMA(1,1,5) as the most efficacious model, shown by its optimal performance measures, which include the minimal Akaike Information Criterion (AIC) value and the maximal R-squared among the assessed alternatives. The projection anticipates consistent rise in GPI from 2024 to 2027, suggesting possible revenue enhancements driven by elements such as market development and heightened insurance penetration. This study enhances the current literature by underscoring the applicability of ARIMA models in projecting public sector insurance, therefore addressing a gap identified in previous studies centered on macroeconomic and efficiency evaluations. The findings corroborate the current research about ARIMA’s forecasting efficacy, endorsing its use in strategic planning and risk management in the insurance sector.

Keywords: ARIMA, Gross Premium, Forecasting, Insurance Sector, New India Assurance

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