Motor Insurance counts for more than 50% of the general insurance business in India. The second position in this segment is occupied by the health insurance and it is growing at geometric progression. These two segments in combine contribute over 65% of the general insurance business. Both are of retail nature, the challenge is to have an appropriate information technology platform and innovative distribution channels for exploration of more growth avenues and cost effective diversifications. The magic solution all players of Motor Insurance and health insurance are looking for is to have a high end technology platform. This platform will enable effective distribution of products with negligible cost. This will make service claims more comprehensive and convenient as in case of second- and third-tier centers it is quite difficult to manage claims from a distance by appointing surveyors. To increase the profit potential the insurance companies should focus on restructuring their offices and align the offices based on products, distribution channels. It will make all of them profitable. For many insurance companies the same office is used for all businesses. The diversification will not only ensure quality service but also increase profit in return. Regarding this aspect, some initiatives have already been attempted. Some insurance majors are on trial to centralise underwriting and claims management. Another important aspect is specialised hiring. The insurance companies should hire people on specialisation basis not on general selling capability. That means, people having adequate knowledge over the life insurance should be given the charge of life insurance products, not the motor insurance. The non-life insurance segment is witnessing a price war. In the initial period(1991-96) of de-tariffing, players tend to garner market share, and there is a tendency to devalue the products. These are universal truths and is similar to the fact that big fishes live on the small fish. Now, the balance sheet has been levelled. So there is least chance of any dumping or artificial price reduction. The insurance business is also dependent on reinsurance activities and reinsurance plays a vital role to level prices. Hence, it can be predicted safely that the price war will settle down in less than a year.