The Indian insurtech sector has witnessed remarkable expansion, as per the Boston Consulting Group (BCG). Currently, it houses over 150 players, including 10 unicorns and soonicorns, and more than 45 minicorns, with a cumulative valuation of $13.6 billion. In the past five years, a staggering 12-fold increase in industry revenues has been recorded, reaching $750 million. This growth is detailed in BCG’s report “India Insurtech Landscape and Trends: Pathways to Inclusive Insurance – A Vision for 2047”.
Nevertheless, the sector still faces a significant hurdle. Insurance penetration, especially in health insurance, is far from ideal. A concerning 45% of medical expenses are being paid out of pocket. This indicates that a large portion of the population is not adequately covered by insurance policies. The root causes of this gap can be traced back to issues related to accessibility, awareness, and affordability. Many potential customers may not have easy access to insurance products, might be unaware of their benefits, or find them too costly.
Yet, there is a glimmer of hope. Macroeconomic factors such as a burgeoning population, rapid technological advancements, a wealth of available data, and a regulatory environment that is conducive to growth present ample opportunities for the insurtech industry to expand. Health Insurtechs, in particular, are spearheading innovation efforts, zeroing in on the three crucial aspects of accessibility, awareness, and affordability. Their initiatives could potentially bridge the existing gap and transform the insurtech landscape in India, making insurance more inclusive and accessible to a larger segment of the population.
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