India’s non-life insurance sector saw a moderate year-on-year (YoY) growth of 4.4% in November 2024, with premiums totaling Rs 21,671.4 crore. While this growth represents a steady rise, it is a slowdown compared to the 8.1% YoY increase recorded in November 2023. This follows a significant achievement in October 2024, when the industry crossed the Rs 30,000-crore mark.
The growth figures for this year, however, are not directly comparable to previous years due to changes in the reporting format. The updated methodology now excludes premiums from long-term policies, affecting the overall data.
The November growth was primarily driven by strong performances in the retail health insurance and third-party motor insurance segments. These gains helped offset declines in fire insurance premiums and stagnant growth in the Motor Own Damage (OD) category.
Saurabh Bhalerao, Associate Director at CareEdge Ratings, noted that the disparity in growth rates is expected to persist until the base effect stabilizes.
Looking ahead, Sanjay Agarwal, Senior Director at CareEdge Ratings, anticipates continued growth in the health insurance sector, particularly within the retail space, where standalone health insurers are expected to maintain a dominant position. Meanwhile, growth in the motor insurance segment remains closely tied to vehicle sales and adjustments in third-party insurance tariffs.
In the medium term, the overall non-life insurance market is projected to grow by 13% to 15%, bolstered by regulatory reforms such as the proposed Insurance Amendment Act of 2024. Key provisions in the Act include the introduction of composite licenses, 100% Foreign Direct Investment (FDI) in insurance companies, and revised capital requirements—all aimed at enhancing market penetration.
However, Agarwal also warned that the industry faces potential challenges, including increasing competition and geopolitical uncertainties, which could impact the sector’s growth trajectory.
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