India’s general insurance sector is forecasted to witness a 13% year-over-year rise in gross written premium (GWP) in the fiscal year 2026, according to India Ratings. This increase reflects a shift toward value-driven growth rather than a surge in new policyholders. In comparison, the industry recorded an 8.5% growth in FY25, following a higher 12.8% growth in FY24. Analysts credit this upcoming rise to ongoing inflation and higher reinsurance costs in certain segments, which are pushing up policy values.
Another major growth engine will be Standalone Health Insurers (SAHIs), expected to jump by 21% in FY26. Their contribution to the overall GWP reached 41% between April and December of FY25. This upward trend is largely attributed to greater public focus on health post-pandemic, escalating medical costs, and the demand for higher coverage amounts. Recent premium adjustments in the health insurance space have also led to more consumers switching providers, highlighting an increasingly aware and active customer base.
In the commercial insurance space, stronger activity is anticipated, thanks to the government’s continuous investment in infrastructure and development. Though public insurers are trailing private ones in performance, reforms and capital infusions are gradually improving their competitiveness.
However, a significant gap remains in urban versus rural insurance coverage. While urban areas enjoy better penetration, rural India still lacks access due to limited distribution, affordability issues, and the absence of tailored insurance products. Addressing these barriers is key to unlocking broader market participation.
Despite facing pricing pressures, insurers are currently supported by steady investment income and capital gains. These financial buffers are helping them maintain healthy underwriting margins and boosting return ratios across the sector. With continued innovation and policy support, India’s insurance market is positioned for long-term, sustainable growth led by both product value and increasing coverage.
