India’s non-life insurance industry witnessed a robust 14.9% year-on-year increase in premiums for May, reaching Rs20,908 crore. While this growth is significant, it marks a slight deceleration compared to the 18.1% growth recorded in the same month last year.
The health and motor insurance segments were pivotal in driving the industry’s performance, although the fire insurance segment experienced a more subdued year-on-year growth of 4.2%.
Health insurance emerged as the primary growth driver, expanding its market share from 39.6% in year-to-date fiscal year 2023 (YTD FY23) to 41.3% in YTD FY25. Despite its pivotal role, the growth rate of the health segment moderated to 16.9% in YTD FY25 from 22.6% in YTD FY24.
Excluding health insurance, the non-life insurance industry grew by 15.7% in YTD FY25, slightly lower than the 16.7% growth when including health insurance contributions.
The surge in premiums was largely underpinned by motor insurance, which constitutes approximately 50% of non-life insurance premiums excluding health. Motor insurance premiums reached Rs14,035.2 crore in YTD FY25, expanding by 15.4% compared to 23.1% in YTD FY24.
“The industry’s growth trajectory remains robust, supported by significant expansions in both health and motor insurance segments,” noted Saurabh Bhalerao, Associate Director at CareEdge Ratings.
Looking ahead, experts predict a continued growth momentum for the Indian non-life insurance market, projecting a moderate annual growth rate of 13% to 15%. Factors such as favorable regulatory environments and the Bima Trinity initiative are expected to sustain this growth.
“Efforts to streamline operational efficiencies and enhance distribution networks are poised to further bolster the sector’s performance,” remarked Gaurav Dixit, Director at CareEdge Ratings. However, potential challenges stemming from intensified competition and global economic uncertainties may pose risks to the sector’s outlook.
In conclusion, while the non-life insurance sector in India shows promising growth prospects supported by key segments, stakeholders remain vigilant amidst evolving market dynamics and external economic pressures.
