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Life insurance premium in India set to cross $100 billion mark this year: Swiss Re

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Life Insurance premium is set to cross the $100 billion mark for the first time in India. Non-life business, particularly health insurance, is expected to pick up as well due to increased risk awareness after the onset of the COVID-19 pandemic according to global reinsurer Swiss Re.

India is going to emerge as the sixth India largest market in terms of total premium volume by 2032 beating many of her emerging market peers according to Jérôme Jean Haegeli, global chief economist at Swiss Re.

The Indian life insurance industry will show resilience and grow at an exceptional rate of 6.6% (in real terms) in 2022 and further grow at 7.1% in 2023. Considering the projected growth rate, the life insurance premiums in India are set to cross $ 100 billion for the first time in 2022. Though the global life insurance premiums growth will almost flat this year and grow by 1.9% in real terms in 2023

The non-life insurance market in India grew 5.8% (in real terms) in 2021 after a slight contraction in 2020. The growth is expected to slow down slightly in 2022 to 4.5%, mainly due to high inflation.

However, the sector is further expected to witness a growth of close to 8% CAGR (in real terms) between 2023 to 2032. One of the driving factors for the sectoral growth is the systematic change to India’s non-life insurance sector brought by the pandemic. It resulted in a greater risk awareness leading to higher demands in health insurance, making it the biggest LoB (Line of Business) by premium volume in 2021.

” Total insurance premiums in India will grow by an average 14% per annum in nominal local currency terms over the next decade, making India the 6th largest in terms of total premium volume by 2032 from 10th largest in 2021″.

Swiss Re expects inflationary pressures because of the Russia-Ukraine crisis to pose significant challenges for both life and non-life insurance industry in the medium term. The Ukraine conflict worsened the near-term economic outlook. ” The global economy is on the brink of inflationary recessions, with policymakers facing an increasingly difficult inflation-growth trade off,” Haegeli said. “Swiss Re expects India to reign as the world’s fastest-growing economy in 2022”.

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