What drove India's life insurance sector to rise 6.6% in August 2025?

But new business premiums fell 5.2% year-on-year in August.

India’s life insurance industry reported slower growth in August 2025 as Annual Premium Equivalent (APE) rose 6.6%, down from 10.5% a year earlier. 

Over the period from August 2023 to August 2025, the industry recorded an 8.6% compounded annual growth rate, with private insurers expanding at 10.0% compared to Life Insurance Corporation of India’s (LIC) 6.1%.

New business premiums fell 5.2% year-on-year in August, reversing gains of 22.4% in July 2025 and 21.9% in August 2024. 

The decline was attributed to weaker single premiums, base effects, and fewer working days due to festival holidays.

CareEdge Ratings said industry performance was weighed down by surrender value regulations and subdued single premium demand. 

However, the GST waiver on individual life and health insurance premiums, effective 22 September 2025, is expected to improve affordability and support growth.

CareEdge forecasts life insurance sector growth of 10% to 12% over the next three to five years, driven by product innovation, digitalisation, and regulatory support. 

A gradual recovery is expected from fiscal year 2026, helped by private insurers’ deeper market penetration and initiatives such as the upcoming Bima Sugam digital marketplace.