Market Potential

Market potential for insurance agents in india



Rapidly growing insurance segments

The domestic life insurance industry registered 19.2 per cent y-o-y growth for new business premium in 2017, generating a revenue of Rs 1.23 trillion (US$ 20.34 billion) largely due to the high growth in the individual non single premiums policies. Individual single premiums received increased from US$ 0.16 billion in 2015 to around US$ 1.02 billion in 2016.

Insurance penetration reached 3.4 per cent in FY16 and is expected to cross 4 per cent in FY17.


Source: Insurance Regulatory and Development Authority (IRDA)


Strong Demand

§ Growing interest in insurance among people; innovative products and distribution channels aiding growth

§ Increasing demand for insurance offshoring

§ Growing use of internet has started increasing demand


Attarctive opportunities

§ Life insurance in low-income urban areas

 § Health insurance, pension segment

§ Strong growth potential for micro insurance, especially from rural areas


Policy support

§ Tax incentives on insurance products

§ Passing of Insurance Bill gives IRDA flexibility to frame regulations

§ Clarity on rules for insurance IPOs would infuse liquidity in the industry

§ Repeated attempts to make the sector more lucrative


Launch of innovative products

§ The life insurance sector has witnessed the launch of innovative products such as Unit Linked Insurance Plans (ULIPs)

 § Other traditional products have also been customized to meet specific needs of Indian consumers

Tax incentive

§ Insurance products are covered under the exempt, exempt, exempt (EEE) method of taxation. This translates to an effective tax benefit of approximately 30 per cent on select investments (including life insurance premiums) every financial year




Premium growing at brisk rate


§ The total insurance market expanded from US$ 23 billion in FY05 to US$ 68.88 billion in FY16.

§ Over FY05–FY16, total gross written premiums increased at a CAGR of 10.49 per cent .

 § Life insurance companies in India earned US$ 25.12 billion as first year premiums in FY17.

 § Gross premium underwritten by general insurers in India reached Rs 86,094.47 crore (US$ 13.39 billion) in FY18 (up to November 2017).

§ Gross premium written in India for non life insurance sector for FY16 is US$ 14.33 billion and in FY16, the gross premium written in India for life insurance sector stood at US$ 54.58 billion.

 § In November 2016, the total growth in life insurance premium was around US$ 2.38 billion as compared to US$ 1.12 billion in November 2015, witnessing a growth of 113 per cent. Similarly during the same period, the individual single premium grew by US$ 995 million as compared to US$ 164.06 million in 2015, recorded a growth of more than 500 per cent.


§ India’s robust economy is expected to sustain the growth in insurance Household savings premiums written.

§ Higher personal disposable incomes would result in higher household savings that will be channelled into different financial savings instruments like insurance and pension policies.

 § Household savings reached US$ 388.20 billion in 2016 from US$ 89 billion in 2000.



§ Insurance penetration reached 3.4 per cent in FY16 and is estimated to have crossed 4 per cent in FY17.

§ Insurance density in India increased from US$ 38.4 in 2006 to US$ US$ 54.99 in 2016 (estimated).

Note: Life insurance density* is defined as the ratio of premium underwritten to the total population in a given year, CAGR - Compound Annual Growth Rate , Figures as per latest available data


§ As of November 2017, life insurance sector had 23 private players in comparison to only 4 in FY02.

§ With 71.07 per cent share market share in FY17, LIC continues to be the market leader.