India's Life Insurance Sector Set for Transformative Growth

The life insurance industry in India is set for significant growth driven by increased financial savings, higher income levels, and enhanced financial inclusion. Regulator IRDAI aims for 'Insurance for All' by 2047, with private players gaining market traction. Policy reforms and bancassurance also contribute to sectoral expansion.

India's life insurance industry stands at a crucial juncture poised for transformative growth according to a report by financial services firm Centrum Broking. Favourable macroeconomic factors such as rising financial savings and increased per capita income are expected to bolster the industry's prospects in the coming years.

With a target of achieving universal insurance coverage by 2047, the Insurance Regulatory and Development Authority of India (IRDAI) is committed to expanding the sector. A recent Centrum report highlights the increased market share of private players, which rose from 56% in 2017-18 to 68% by Q2 2024-25.

Despite the rise of private entities, the state-owned LIC retains a stable 32% market share. The dominance of prominent players like SBI Life and HDFC Life has grown, as they now account for a majority of the private sector's 60% market share. Policy measures have improved financial inclusion significantly, underpinning the sector's growth, and bancassurance partnerships are becoming vital distribution channels.

(With inputs from agencies.)