According to the Insurance Regulatory and Development Authority of India (IRDAI)’s Annual Report 2022-23, the overall insurance penetration in India reduced from 4.2% in 2021-22 to 4% in 2022-23.
Life insurance penetration has reduced marginally from 3.2% in 2021-22 to 3% in 2022-23 while non-insurance penetration for both the years remained unchanged at 1%.
Note: Insurance penetration is calculated as the percentage of total premiums collected to the country’s Gross Domestic Product(GDP).
Policy distribution: Public vs Private sector:
During FY23, public sector insurers issued 204.29 lakh policies (71.75%) while private life insurers issued 80.42 lakh policies (28.25%).
Public sector: 35.81% policies were sold to women and the remaining 64.19% were sold to men.
Private sector: 30.13% were sold to women and 69.85% were sold to men.
Insurance sold to women:
i.A total of 2.84 crore policies were sold during the fiscal year 2022-2023 (FY23). Of this, 97.38 lakh were sold to women which is 34.20% of 2.84 crore total policies as against a share of 34.7% in 2021-22.
ii.Karnataka(44.23%), Kerala(43.96%) and Mizoram (42.97%) have recorded the highest number of life insurance policies sold to women while Ladakh(23.10%), Haryana (27.16%) and Jammu & Kashmir (J&K) (28.07%) recorded the lowest.
Claim settlement ratio:
i.In terms of the number of life insurance policies, the claim settlement ratio decreased to 98.45% in 2022-23 from 98.64% in 2021-22.
ii.LIC reported claim settlement ratios of 98.52% in 2022-23 (compared to 98.84% in 2021-22) and private insurers reported 98.02% (compared to 98.11% in 2021-22).
iii.Health insurance sector, general and health insurance companies settled 85.66% of claims by policy count in 2022-23.
iv.The general and health insurers settled 2.36 crore health insurance claims, amounting to Rs 70,930 crore.
Performance:
i.Premium income of life insurance companies rose by 12.98% to Rs 7.83 lakh crore in FY23 while the premium income of general insurers increased by 16.4 per cent to Rs 2.57 lakh crore.
ii.Private insurers recorded a growth of 16.34% in premiums while public sector insurers recorded a growth of 10.90%.
iii.Renewal premium continues to contribute the majority of total premiums underwritten by life insurers at 52.56% in 2022-23. The remaining 47.44% is contributed by the new business premium.
iv.The growth in new business premium was higher at 17.9% compared to renewal business at 8.88%.
v.Life Insurance Corporation of India (LIC) is the only life insurer underwriting business outside of India, which collected a total premium of Rs 404.78 crore during 2022–23.
International Comparison of Insurance Penetration:
India ranks 25th in international insurance penetration for the financial years 2021–22 and 2022–23, while the USA topped the list. (India ranked 27 in the financial years 2020–21 and 2021-22).
About Insurance Regulatory and Development Authority of India (IRDAI):
Chairperson– Debasish Panda
Headquarters– Hyderabad, Telangana
Established in 1999 (incorporated in April 2000)
