India's Insurance Market Set to Lead G20 Growth Amid Economic Expansion and Natural Disaster Challenges
January 14, 2025
Despite the promising growth in the insurance sector, India faced economic losses of USD 12 billion from natural disasters in 2023, surpassing the 10-year average of USD 8 billion.
India's insurance market is poised to become the fastest-growing economy in the G20 over the next five years, with total premium volumes expected to rise by 7.3% annually in real terms.
Life insurance accounts for a substantial 74% of total premium volumes in India, highlighting its significance in the overall insurance landscape.
Looking ahead, India is projected to surpass Germany and Japan to become the world's third-largest economy by the end of the decade, bolstered by strong domestic consumption and ongoing economic reforms.
Global economic growth is expected to remain steady at 2.8% in 2025 and 2.7% in 2026, which will provide additional support to India's expanding economy.
The rapid economic growth in India has outpaced the country's efforts to address vulnerabilities from natural disasters, underscoring the urgent need for enhanced risk assessment in high-risk areas such as Gujarat, Maharashtra, Tamil Nadu, and Delhi.
The non-life insurance sector is also projected to grow by 7.3% in 2025, driven by increasing risk awareness, economic growth, and regulatory support for digitalization.
Health and motor insurance dominate the non-life insurance segments, while agricultural insurance has seen improved penetration thanks to reforms in the Pradhan Mantri Fasal Bima Yojana implemented in 2023.
In the life insurance sector, premiums are anticipated to grow by 4.8% in 2024 and 5% in 2025, following a modest increase of only 0.7% in 2023 due to regulatory and tax changes.
Summary based on 1 source
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Business Standard • Jan 14, 2025
India to top G20 with 7.3% insurance premium growth over 2025-29: Report