India’s insurance premium volume stands at $127 Bn as of 2021 (Life –

76%, Non-Life – 24%). Total insurance premium in India increased by

13.5% in 2021 as against a global average of 9%.

● In terms of total premium volumes, it is the 10th largest market globally

and the 2nd largest of all emerging markets, with an estimated market

share of 1.9%. It is expected that premiums will grow by an average 9%

p.a. (in real terms) over the next decade. India is poised to emerge as

one of the fastest-growing insurance markets in the coming decade.

● India has 67 insurers of which 24 are life insurers, 26 are general

insurers, 5 are stand-alone health insurers, and 12 are re-insurers (March

2022).

● The insurance industry in India has witnessed an impressive growth rate

over the last two decades driven by the greater private sector

participation and an improvement in distribution capabilities, along with

substantial improvements in operational efficiencies

Snapshot of key insurance metrics

● Insurance density in India has increased from $11.1 in 2001 to $91 in

2021 (Life insurance- $69, Non life insurance – $22)

● Insurance penetration in India has been steadily increasing (from 2.7%

in 2000 to 4.2% in 2021)

● The insurance penetration in the life insurance sector was 3.2% in 2021

-twice more than emerging markets and slightly above the global

average
● In FY 22, the gross direct premium of non-life insurers and life insurers

witnessed a YoY growth of 10.8% and 10.2%, respectively

● In FY23, the New Business Premium of the life insurance industry grew

at 17.91% with private insurers accounting for 37% of the NBP of ~$45 Bn.

First Year Premium for Life Insurers (for quarter ending June'23) is $8.7

Bn, with private insurers accounting for 38.5%.

● India’s share in the global life insurance market was 3.23% in 2021. The life
insurance premium registered YoY growth of 10.2% in FY22, with new
businesses contributing 45.5% of the total premiums received by the life
insurers
● India's share in the global non-life insurance market was ~1% in 2021.

The Indian non-life insurance sector recorded 11.3% growth during 2021

whereas the global non-life insurance premium had only 8.4%

● The gross direct premium of non-Life insurers (within and outside India)

registered YoY growth of 10.8%, primarily driven by health and motor

segments. The net incurred claims of non-Life insurers stood at INR 1.4

Lakh Cr in FY22, primarily driven by rising per capita income, product

innovations and customization, development of strong distribution

channels, and rising financial literacy.

● The insurance penetration of life insurance sector has gone up from 2.2%

in FY 02 to 3.2% FY 22

● The insurance penetration of non-life insurance sector has gone up from

0.5% in FY 02 to 1% FY 22

● The life insurance density has gone up from $9.1 in FY 02 to $69 in FY 22

● The non-life insurance density has gone up from $2.4 in FY 02 to $22 in

FY 22
● Life insurance industry recorded a total written premium income of $91

Bn (INR 6.93 Lakh Cr) in FY 22, registering growth of 10.2% over FY 21.

The private sector insurers posted 17.4% growth in premium, LIC

recorded 6.1% growth

● In FY 22, new business and renewal premium accounted for 45.5% and

54.5% of the total premium received by life insurers, respectively

● The traditional products registered a growth of 10.1% in FY 22, with a

premium of $77 Bn (INR 5.92 Lakh Cr).

● Unit-linked products (ULIPs) registered a growth of 10.2% with an

increase in premium to $13 Bn (INR 1 Lakh Cr) in FY 22. The share of

unit-linked products in total premium was 14.5%

● In FY 22, the life insurance industry registered a growth of 3.5% in the

number of new policies issued against FY 21

● Non-life insurance industry underwrote total direct premium of ~$29 Bn

(INR 2.21 Lakh Cr) in FY 22, registering a growth of 11% from FY 21

● The Indian health insurance industry reported a growth of 26.3% in FY

22, making it the largest non-life insurance sub-segment with a market

share of about 36%, followed by the motor segment at 32%

● Fire and other segments also recorded positive growth of 7.1% and 1.1%,

respectively in FY 22

● The general and health insurers have issued 266 Mn policies in FY 22,

reporting an increase of 7.7%

● The number of insurance policies issued to women in the year 2021-22 is

around 10 Mn which is 34.7% of 30 Mn total insurance policies as against

a share of 33% in 2020-21

● The total mortality protection gap in India stands at $16.5 Tn (as of

2019) with an estimated protection gap of 83% of total protection need.

additional life premium opportunity of average $78.2 Bn annually over

2020-30

Regulatory Landscape

The insurance regulator IRDAI has also undertaken various initiatives towards

boosting the insurance penetration, such as permitting insurers to conduct

video-based KYC, launching standardised insurance products and allowing

insurers to offer rewards for low-risk behaviour

IRDAI has taken up the mission of ‘Insurance for All’ by 2047 which is expected

to lead to a significant increase in insurance penetration and would help in

bolstering the ease of doing business and will aid in making the sector more

investment-friendly

IRDAI has “engaged four mission-mode teams” to work on transition to a

risk-based solvency regime from current regime of capital or factor-based

solvency, with the aim of beginning the shift within two years

IRDAI has allowed PE funds to directly invest in insurers, allowed promoters to

dilute up to 26% stake & dispensed with its approval for raising capital such as

subordinated debt and preference shares