Life insurance coverage penetration in India declined to 2.7% in FY25, from 2.8% a yr earlier, whereas non-life insurance coverage penetration stayed flat at 1%, the newest Insurance coverage Regulatory and Growth Authority of India (Irdai) knowledge revealed Tuesday confirmed.
In distinction, world penetration was at 7.3% in 2024, with life insurance coverage accounting for 3% and non-life insurance coverage 4.3%.
Insurance coverage density, measured as per capita premium, rose to $97 in FY25 from $95 within the earlier yr. Life insurance coverage density elevated from $70 to $72, whereas non-life insurance coverage density remained unchanged at $25. Globally, insurance coverage density was $943 in 2024, with life insurance coverage at $388 and non-life insurance coverage at $555, with larger per capita spending on insurance coverage in different markets. Insurance coverage penetration and density are two metrics typically used to evaluate the extent of improvement of the insurance coverage sector in a rustic.
Whereas insurance coverage penetration is measured as the share of insurance coverage premiums to GDP, insurance coverage density is calculated because the ratio of premium to inhabitants per capita premium.
The information present that whereas insurance coverage density in India has been growing regularly since 2016-17, the tempo of development has been inadequate to slim the hole with world ranges.
The regulator has taken a number of measures to deal with insurers’ profitability considerations which can doubtless improve penetration by means of a interval of adjustment to new provisions.Swiss Re forecasts that life premiums in India will develop under pattern at 3.5% in 2025 towards the 2014-23 CAGR of 4.9%, because the market adapts to modifications in taxation, bills and give up norms, earlier than recovering to five.7% in 2026.
Throughout the life insurance coverage phase, premium development remained optimistic in 2024-25. The trade reported whole premium earnings of ₹8.86 lakh crore, registering development of 6.73% in the course of the yr.
