The non-life insurance industry continued to report double-digit growth in November, after near-flat growth in September. The industry reached ₹19,209.2 crores in November, a 22.1% growth YoY. Collective gross direct premium underwritten for non-life insurance companies grew 22.1% year-on-year (YoY) to ₹19,209.2 crores in November from ₹15,735.3 crores a year ago, data shared by CareEdge ratings showed.
“The non-life insurance industry continued to report double-digit growth in November 2022 after reporting near-flat growth in September 2022. The industry reached ₹19,209.2 crores in November 2022, a 22.1% growth YoY,” the report said.
So far this year, the industry has grown 16.5% compared with 11.6% in the same period last year. Growth was driven by health (especially the group segment), and motor insurance.
“General Insurers’ November 2022 numbers were up by 25.7%, a rise of 6x, compared to an increase of 4.2% in November 2021, while for YTDFY23, the growth which has been driven by the group health and motor segments, has been nearly 1.7x that was witnessed last year,” according to the report.
The market share of private non-life insurance companies has witnessed a sustained increase to 61% in YTD FY23 from 58% in YTD FY22 and 57% in YTD FY21.
Health insurance premiums have been the primary growth lever of the non-life insurance industry since the commencement of the Covid-19 pandemic. This has resulted in the segment increasing its market share from 29% for YTD FY21 to 35.2% for YTDFY23.
The health segment has grown by 22.5% for YTD FY23, which is lower than the growth of 28.9% witnessed for YTD FY22, it said.
CareEdge Ratings said that in YTD FY23, motor insurance reached Rs. 50,337 crores and has continued to grow at over 4 times the rate reported for a similar period in FY22.
“In YTD FY23, Motor OD grew by 18.1% (vs. 4.9% for YTDFY22) and Motor TP rose by 16.3% (vs. 3.2% for YTDFY22). For November 2022, Motor OD and Motor TP premiums grew by 12.8% and 14.3%, respectively. The growth can be attributed to last year’s low base, the repricing of Motor TP rates and higher vehicle sales,” it stated.
According to the rating agency, the non-life insurance industry has maintained its strong FY23 journey driven by the health and motor segments supported by enabling regulations. Despite a higher base and lower growth rates compared to FY22, the health segment is anticipated to witness continued demand amid increased awareness post-Covid and rationalisation of discounts.
“The long-term growth of motor insurance would be driven by growth in the automotive industry, which would boost the motor insurance market and increase penetration amongst the uninsured vehicles on road,” the report said.
Further, with the easing of the pandemic’s impact and higher investment yields, sector profitability is anticipated to improve as the loss ratio of the health sector moderates. However, inflation and slowdown in the economy continue as risks to the growth in the sector, it added.
