The non-life insurance industry faced several challenges despite robust growth in 2023. These industries had to navigate through an economic slowdown, high interest rates, and increased retail, and medical inflation. While the general insurance penetration remains relatively modest, the sector showed resilience and is poised for strong growth in the medium term.
Segmentation and diversification of the market
The non-life insurance market in India is a large and diverse sector, comprising of various types of insurers- general insurers, health insurers, and specialized insurers. General insurers cover risks other than life, such as property, motor, travel, etc. Health insurers cover medical expenses incurred because of an illness or injury. Specialized insurers cover specific risks or segments, such as agriculture, export credit, etc.The non-life insurance sector in the country has witnessed a shift in market share from public to private players in the last five years. Major public sector insurers such as New India Assurance Company, National Insurance Company, and Oriental Insurance Company are trying to restore market leadership by improving their operations and technology, such as video-based KYC.
At the same time, private insurers, such as HDFC, ICICI, and SBI, have led the market with cumulative premiums of over a trillion Indian rupees. These market leaders have stimulated competition by providing various life and non-life insurance products, along with enhanced consumer service through technological solutions like online policy handling and customized products., private insurers distinguish themselves from the competition and ensure continued growth.
Navigating India's health and motor insurance boom
Overall, India’s non-life insurance industry has experienced remarkable growth, with health and motor insurance leading the way. India’s health insurance sector has grown substantially due to increased awareness of health risks and rising medical costs, especially after the COVID-19 pandemic. Factors like government initiatives such as Ayushman Bharat and PMJAY, and digital advancements have driven this expansion. Insurers now offer tailored policies and wellness programs.Similarly, with significant growth in the automotive industry, motor insurance remains crucial in India’s insurance landscape. Digitalization has streamlined processes, while telematics-based usage policies and regulatory changes have reshaped the market. Recent developments include long-term policies, attractive no-claim bonuses, and adaptations for the growing electric vehicle market.
Non-life insurance sector continues to evolve amidst challenges and opportunities., its Its resilience, adaptability, and commitment to innovation positions it for sustained growth and relevance in the dynamic landscape of risk management.
