Insurance penetration is on the rise in India, a sigma report by Swiss Re has found. The increase was marginal, showing share of insurance premiums in the country’s Gross Domestic Product (GDP), also known as insurance penetration, to be at 3.69% in FY18. This is a 0.20% increase from the 3.49% that was registered a year ago.
Furthermore, the report also stated that the premium per person (insurance density) increased from $59.7 last year to $73 this fiscal year. Life insurance penetration also increased in FY18 by 0.04% to 2.76%, whereas general insurance grew to 0.93% i.e. a rise of 0.16%.
According to the report, the growth was impacted by the government’s implementation of measures such as demonetisation, Goods and Services Tax reforms and real estate regulations. All these led to weakening of private consumption and investment, but this decline was offsetted by accelerated government investments that increased in the final quarter of the fiscal.
Life insurance premiums in the country grew by 8% year-on-year (YoY) to $73,240 million. On the other hand, non-life insurance premiums grew 16.7% YoY on the back of strong demand for crop insurance, to $24,674 million in FY18.
Despite the growing figures, India is still lacking behind when it comes to insurance penetration. The world average stands at 6.13%, with the average insurance density globally being $650. The highest-ever insurance penetration that India witnessed came in FY10 when the figure stood at 5.2%.
*Source:Money Control
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