According to the Allianz Global Insurance Report 2025, India is poised to become the world’s fastest growing insurance market, with an expected annual growth rate of 11.5%, surpassing Japan to claim the position of the second largest insurance market in Asia after China.
Strong Growth Drivers Amid Underpenetration
India’s rapid insurance market expansion is driven by strong demand for protection products combined with underpenetration, presenting vast untapped potential. Despite rapid growth, insurance penetration remains low — the average Indian household spends roughly $100 annually on insurance, which is less than one-fifth of the average Chinese household’s insurance spend.
Market Growth by Segment in 2024
In 2024, the Indian insurance market is forecasted to grow 10.6%, outpacing the previous year’s already robust growth of 7.7%. Growth is broad-based but particularly led by:
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Health insurance, expected to grow 20.8%, reflecting rising consumer awareness and demand amid limited public healthcare infrastructure.
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Life insurance, the largest segment, growing at 10.6%, contributing nearly 75% of all premiums.
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Property and casualty (P&C) insurance, which saw growth slow slightly but remain solid at 7.9%.
The report hailed India as the “real growth champion in Asia”, projecting that its life insurance market will soon overtake Japan’s to become the region’s second largest.
Global Context and Broader Market Trends
The Allianz report forecasts global insurance premiums to grow 8.6% in 2024, adding $577 billion to reach a total of $7.3 trillion. Globally, life insurance leads performance, supported by rising interest rates and increasing demand for annuities, particularly in North America and China.
Demand for insurance worldwide is influenced by factors such as:
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Economic uncertainty
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Climate risks
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Aging populations
Ludovic Subran, Chief Economist at Allianz, noted that insurance growth is often driven by policy inaction, including underinvestment in climate adaptation and delayed pension reforms.
India’s Long-Term Outlook: Exponential Growth Ahead
Looking ahead, Allianz projects a 5.3% annual growth rate for the global insurance market over the next decade. India’s health insurance market is expected to be the most dynamic, expanding by 18.5% annually as millions seek coverage amid constrained public healthcare.
Asia (excluding Japan) will dominate global premium growth, generating more than $1.1 trillion in additional life insurance premiums by 2035 — exceeding the combined growth of North America and Western Europe.
As India solidifies its leadership in this transformation, the Allianz report underscores a clear message: India’s insurance market future is not only promising but exponential.
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