The Indian general insurance industry, despite maintaining double-digit growth in gross premium during the fiscal year 2023-24 (FY24), fell short of reaching the coveted ₹3 trillion mark. Let’s delve into the key trends, challenges, and contributing factors that shaped the industry’s performance.
Growth Figures
In FY24, the general insurance industry witnessed a 12.78% YoY growth in gross direct premium underwritten, reaching ₹2.89 trillion. While this growth is commendable, it represents a 4% slowdown compared to the previous financial year’s robust 16.4% uptick.
Segment-Specific Insights
1. Health, Motor, and Crop Insurance
The non-life industry faced headwinds in segments such as health, motor, and crop insurance. These factors collectively prevented the industry from crossing the ₹3 trillion milestone. The slowdown in these areas impacted overall premium collections.
2. Agriculture Insurance Company (AIC)
AIC, a specialized insurer, played a significant role in the industry’s sluggish growth. It reported a 29% decline in combined gross premium, falling from ₹15,817 crore in FY23 to ₹11,190 crore in FY24. The agriculture insurance segment, in particular, witnessed a substantial 32% YoY decline in premiums, dropping from ₹14,619 crore to ₹9,919 crore.
3. Export Credit Guarantee Corporation (ECGC)
ECGC, another specialized insurer, also contributed to the industry’s challenges. Although it posted a 6.12% YoY growth in premiums, its impact was not sufficient to offset the overall slowdown.
Market Share Dynamics of General Insurance
- Public sector general insurers grew by 8.99%, reaching ₹90,344.49 crore in premiums.
- Private sector counterparts outperformed, achieving a 17.53% growth and contributing ₹1.55 trillion.
- Market share shifted, with public sector insurers slightly decreasing to 31.18% (from 32.27% in FY23) and private insurers increasing to 53.52% (compared to 51.36% in the year-ago period).
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Standalone Health Insurers (SAHIs)
- SAHIs witnessed a remarkable 26.19% increase in gross direct premium, reaching ₹33,115.95 crore.
- Star Health & Allied Insurance Company led the pack with a 17.75% YoY growth in premiums, totaling ₹15,251.11 crore.
Health Insurance Takes the Spotlight
- Stand-alone health insurance companies outperformed general insurers by 2 times.
- The general insurance industry recorded an annual premium of nearly ₹2.9 lakh crore for FY24, marking a 13% rise from the previous fiscal year’s ₹2.6 lakh crore.
Conclusion
While the industry faced challenges, health insurance emerged as a beacon of growth. As insurers adapt to changing dynamics, addressing crop insurance and other segments will be crucial for sustained progress. The quest for the ₹3 trillion mark continues, and strategic innovations will pave the way forward.
Disclaimer: The information provided is based on available data and industry reports.
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