While the poor people are the most vulnerable to risks, the majority of them have to manage risks with their own means they are compelled to borrow from informal markets at very high rates of interest, getting trapped in the vicious cycle of poverty. Very few have access to formal insurance and depends on informal mechanism to cope with shocks. It is surprising that despite such compelling needs of risk management, the poor do not seek insurance coverage. In India, 90% of the population does not have any kind of social security, and insurance still remains a 'to be sold' rather than a 'to be bought' product. With the liberalization of the Indian economy in the 1990s, and the government's stance of inclusive growth, the Insurance Regulatory and Development Authority Act was passed in 1999, and the insurance sector was opened for the private sector. Subsequently, micro insurance regulations were introduced in 2005.