India’s Leading BFSI & FinTech Companies 2024

[ INSURANCE SECTOR OVERVIEW ] India’s Leading BFSI and FinTech Companies 2024 21 Performance of Insurance Sector in FY23 Data pertains to 2022 Source: Insurance Regulatory and Development Authority of India Profitability of insurance sector improves ledby life insurance segment ( ` bn) Source: Insurance Regulatory and Development Authority of India, D&B Research PERFORMANCE OF INSURANCE SECTOR IN FY2023 The Life Insurance market in India has recorded a consistent premium growth over the years. During FY2023, premium income of life insurance segment grew by 12.9% to ` 7.83 trillion, largely driven by the private sector players which registered an impressive growth of 16.3% in the premium. On the other hand, public sector life insurers recorded 10.9% growth in premium in FY2023. Around 52.6% of total premium underwritten by life insurers is drawn from renewal premium, while balance 47.4% is contributed by new business premium. However, growth in new business premium (at 17.9%) surpassed that of renewal premium (8.9%). Further, the year marked listing of public sector insurer Life Insurance Corporation (LIC) of India in May 2022. LIC IPO worth US$ 2.7 bn is the largest IPO ever in India and the 6th biggest IPO globally in 2022. In case of non-life insurance segment, gross direct premium grew by 16.4% to ` 2.57 trillion in FY2023, driven by health, and motor insurance segments. It is evident that the COVID-19 pandemic has enhanced awareness on health insurance and demand for protection products, which resulted in 21% growth in health insurance premium in FY2023. In terms of profitability, 17 out of 24 life insurers reported profits in FY2023. Net profits of life insurance segment increased substantially by 452% to ` 427.9 bn largely driven by the surge in profits of public sector insurer which reported almost 800% growth in net profits. On the other hand, private sector insurers reported 72.4% growth in their net profits in FY2023. Non-life insurance segment, on the other hand, reported a marginal contraction in loss to ` 25.65 bn in FY2023 as against ` 28.56 bn in FY2022. Contraction in loss in FY2023 can partly be attributed to the reduction in incurred claim ratio to 82.95% in FY2023 from 89.08% in FY2022. Dun & Bradstreet