
Summary:
India's insurance industry is predicted to grow significantly in FY25, driven by economic growth, higher incomes, and increased awareness of health risks. According to Moody's, government reforms, pricing adjustments, and an expanding middle class will lead to higher premiums. GDP growth is expected to be 7%, with an 11% increase in GDP per capita. Despite challenges, health insurance premiums rose by 21% in the first eight months of FY24.
In FY23, India’s insurance density increased to Rs. 8,220.99 (US$ 95), yet it remains behind developed countries, indicating substantial growth potential. While private insurers' solvency is improving, regulatory changes continue to pose challenges for capital adequacy. Government reforms, such as LIC's recapitalization and stake sale, have boosted profits for state-owned insurers. Despite challenges like complying with IND AS 117, the sector is expected to continue growing as reforms and economic prosperity progress.
Source: IBEF
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