India's Life Insurance Sector Biggest in World, to Grow by 15% Over Next 5 Years

New Delhi: The insurance sector in India comprises of 24 companies operating in the life insurance business and 29 non-life insurers.

Life Insurance Corporation (LIC), a public sector company, is the biggest player in the life insurance business.

There are six public sector non-life insurers. In addition, the sole national re-insurer is the General Insurance Corporation of India (GIC Re). A reinsurance company is one that purchases claims from insurance companies to spread the risk more evenly through the financial markets.

Of the 29 non-life insurance companies, five private sector insurers are registered to underwrite policies in health, accident and travel insurance segments. They are Star Health and Allied Insurance Company Ltd, Apollo Munich Health Insurance Company Ltd, Max Bupa Health Insurance Company Ltd, Religare Health Insurance Company Ltd and Cigna TTK Health Insurance Company Ltd. There are two more specialised insurers belonging to public sector, namely, Export Credit Guarantee Corporation of India for Credit Insurance and Agriculture Insurance Company Ltd for crop insurance.

In FY 2015-16, the life insurance industry recorded new premium income of Rs 1.38 trillion ($20.54 billion), a growth rate of 22.5%. The general insurance industry recorded 12% growth in premiums underwritten.

India’s life insurance sector is the biggest in the world with about 360 million policies which are expected to increase between 12-15% over the next five years. The country’s insurance market is expected to quadruple in size over the next 10 years from its current size of $60 billion. During this period, the life insurance market is slated to cross US$ 160 billion.

The Indian insurance market is a huge business opportunity waiting to be harnessed. India currently accounts for less than 1.5 per cent of the world’s total insurance premiums and about 2 per cent of the world’s life insurance premiums despite being the second most populous nation. The country is the fifteenth largest insurance market in the world in terms of premium volume, and has the potential to grow exponentially in the coming years.