India’s non-life segment finds footing: AM Best

It may still face challenges in underwriting, pricing, and high reinsurance costs.

India's non-life insurance sector has improved to having a stable condition from being in the negative, AM Best reported.

The credit agency cited a robust growth potential driven by economic development and rising insurance demand. Recent regulatory developments, streamlining product development and supporting cost optimisation, contribute to the positive outlook. 

Despite underwriting challenges due to market competition, price inadequacy, and increased reinsurance costs, the segment exhibits resilience. 

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India's gross domestic product growth of 7.2% in FY2023 and 7.8% in Q1 FY2024 fuels a strong 16.4% premium growth in the non-life segment in FY2023. 

Regulatory initiatives, including targets for premium growth and a vision of 'Insurance for All' by 2047, aim to promote sustainable growth and financial inclusion. 

Despite a low penetration rate of 1% in FY2023, regulatory efforts are seen as supportive of meeting rising demand over the medium to long term.