India is the fastest growing insurance market in the world!

ATK
New Delhi [India], February 2: India's insurance market has undergone numerous changes and has become one of the fastest-growing markets today. It comprises two primary segments - Life and General Insurance. Life insurance includes whole life insurance, Term Insurance, Unit Linked Insurance plan, Endowment policies, etc. If we talk about general insurance, it includes motor insurance, crop insurance, health insurance, etc. The insurance sector in India is a mix of both private and public sectors.
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Insurance industry Market Size
The insurance industry of India has 57 insurance companies - 24 are in the life insurance business, while 34 are General insurers. Among the life insurers, Life Insurance Corporation (LIC) is the sole public sector company. There are six public sector insurers in the non-life insurance segment. In addition to these, there is a sole national reinsurer, namely General Insurance Corporation of India (GIC Re). Other stakeholders in the Indian Insurance market include agents (individual and corporate), brokers, surveyors and third-party administrators servicing health insurance claims
Insurance Sector Growth Analysis by the India Brand Equity Foundation
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.
The first quarter of FY24 saw non-life players' premium income increase by 17.9% year-over-year to Rs. 64,262.8 crore (USD 7.72 billion) due to strong demand for health and motor policies.
The premium in the month of March 2023 for the private life insurance industry grew at a healthy pace of 35% on a year-on-year basis and 20% for FY23.
Life insurance firms collected 18% more premiums in FY23 compared to the year before. Life insurers collected Rs. 3.71 lakh crore (USD 44.85 billion) as the first-year premium in FY23 as against Rs 3.14 lakh crore (USD 37.96 billion) in FY22, shows the latest IRDAI data.
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Factors Driving Growth in the Insurance Sector in India
The pandemic has highlighted the role insurance plays in safeguarding our well-being and securing our future. Even beyond the pandemic effect, the insurance industry has experienced a surge driven by evolving demographics and a thriving economy. India's young population, increasing disposable incomes, growing financial awareness, and robust regulatory support are all contributing to the sector's growth.
As per the Insurance Regulatory and Development Authority of India (IRDAI), India's insurance industry is projected to reach USD 222 billion by 2026 and become the sixth-largest insurance market globally, surpassing countries like Germany, Canada, Italy, and South Korea.
Apart from that, there are some other factors also contributing to the growth of Insurance market
1. Favourable Demographics
68% of India's population is young and 55% of its population is in the age group of 20-59 (working population) in the year 2020 and is estimated to reach 56% of the total population by 2025. These point towards a young insurable population in India
2. Wide middle-class expansion
By 2030, India will add 140 Mn middle-income and 21 Mn high-income households which will drive the demand and growth of the Indian insurance sector.
3. Technological Advancement
The insurance landscape in India has undergone a significant transformation moving away from its traditional offline structure to rapid digitization, coupled with product innovations and progressive regulations. Apart from that, the introduction of user-friendly mobile apps has simplified the insurance purchasing process, improving customer experience and expanding distribution channels. Today, numerous FinTech start-ups like PBPartners and major insurance companies offer products through apps and websites, streamlining the insurance acquisition process. We would like you to know that in October 2022, Policybazaar's PBPartners launched its mobile app to facilitate the ease of insurance business for its advisors digitizing their insurance business. PBPartners is one of the leading Insurtech Platforms in India.
4. Emergence of PoSPs
The establishment of the PoSP agent framework, enabling cross-insurer operations, has given rise to a new category of substantial insurance brokers, insurance PoS agents. In the span of the last 8 years, the count of Point of Salespersons (PoSP) agents has remarkably expanded to 14.48 lakhs in FY22, marking a substantial 75% increase from the previous year.
Notably, the PoSP agent network is merely 15% smaller than the combined network size of general and health insurer agents, demonstrating faster growth momentum. This positions the PoSP model to emerge as a vital distribution channel for insurers in the future.
5. Increased Distribution of Rural Insurance:
Including the uninsured rural areas and the urban poor in insurance coverage is crucial to enhance insurance penetration in India. Insurance companies provide creative, affordable insurance solutions that correspond to the market. The government of India also introduced Ayushman Bharat to provide insurance for India's 10 crore poor and vulnerable families and provides coverage up to Rs. 5 lakh (USD 6,117).
6. Key Technologies: Change the face of the Indian Insurance and Insurtech segment.
Factors Driving Growth in the Insurance Sector in India
* Artificial Intelligence (AI)
* Internet of Things (IoT)/
* Machine Learning (ML)
* White Label/Application Programming Interface (APIs)
India's Insurance Sector 2024 vision
In 2024, the insurance industry is poised for further transformation, focusing on enhancing accessibility and relevance for individuals beyond metropolitan areas. This marks the advent of Insurance 2.0, symbolizing an ongoing journey of continuous evolution and reinvention. A common objective within the industry is encapsulated in the vision of achieving 'Insurance for all by 2047,' underscoring a commitment to ensuring financial security for every individual. Moreover, the industry is likely to experience an increased reliance on technology and a transition from a role-based to a principle-based operational framework. Overall, the Insurance market in India is expected reach USD 222 billion by 2026
Steps we can take in 2024 to increase the insurance penetration in India
* Insurers need to align with dynamic changes in customer behaviour and preferences. By offering quick personalized products and prioritizing flexibility over mass offerings, insurers can better meet customer needs and manage perceptions.
* Leverage technology, align with customer behaviour, optimize data usage, simplify claims management, adopt hybrid distribution models, and tackle fraud.
* Digitalization should be a priority across the value chain to reduce costs, improve efficiency, and support ecosystem development.
The Insurance Regulatory and Development Authority of India (IRDAI) has set a target of achieving universal insurance coverage by 2047. To make this vision a reality, IRDAI underscores the need for a higher number of insurance providers, a more diverse range of products, and an expanded network of distribution partners. Projections from multiple sources suggest that the industry expected to witness growth ranging from 12% to 18%.
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(ADVERTORIAL DISCLAIMER: The above press release has been provided by ATK. ANI will not be responsible in any way for the content of the same)