Non-Life Insurance Update For June 2023
Non-Life Insurance Update For June 2023
Overview
In June 2023, the non-life insurance industry reported a premium of Rs 20,451.9 crore growing by 14.8% y-o-y, compared to 20.6% in the same period last year.
Meanwhile, for Q1FY24, the industry has continued to report double-digit growth. This growth has continued to be driven by health (especially the group segment),
and motor insurance. However, the fire segment continued its underperformance with subdued y-o-y growth of 5.9%.
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Non-Life Insurance Premiums Continue to Move Up in June 2023; Motor and Health Maintain Their High Share
• General Insurers’ June 2023 numbers were up by 12.8%, compared to an increase of 19.9% in June 2022. The growth can primarily be attributed to health
and motor insurance. The growth in Motor insurance was mainly due to normal renewals and growth in passenger vehicle sales in Q1FY24. However, with
the fire segment growing at a relatively slower pace, the overall growth rate was slower as compared to last year.
• Standalone Private Health Insurers (SAHI) continued to move on their growth curve as June 2023 numbers touched Rs 2,474.6 crore increasing from the
May 2023 numbers of Rs 2,098.2 crore and Rs 2,003.1 crore in June 2022. This monthly growth of 23.5% was lower than the 32.7% reported in June 2022.
Similarly, Q1FY24 reported a growth rate of 26.5% compared to the same period last year (growth rate of 28.6%). Meanwhile, both Retail and Group Health
segments posted growth of 18.0% and 23.2%, respectively.
• Specialised insurers posted an increase of 103% in June 2023 compared to a fall of 20.3% in June 2022, meanwhile, Q1FY24 numbers grew sharply by
87.6% vs. a drop of 8.3% for the comparable period in FY23.
• For the month of June 2023, private companies reported higher growth of 18.1% while public sector non-life insurance companies posted a growth of 9.3%.
In June 2023, private players grew by nearly 2.0x of their public counterparts given their strong market presence and relatively better solvency levels. The
market share of private non-life insurance companies has witnessed a sustained increase to 64% for Q1FY24 from 62% in FY23 and 59% in FY22.
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Non-Life Insurance Premiums Continue to Move Up in June 2023; Motor and Health Maintain Their High Share
For Q1FY24, all segments barring the liability segment have shown y-o-y growth.
• Health insurance premiums continue to be the primary growth lever of the non-life insurance industry. This has increased the segment’s market share from
38.5% for Q1FY22 to 40.0% for Q1FY24. The health segment has grown by 20.7% for Q1FY24, which is lower than the growth of 24.8% witnessed for
Q1FY23.
o Amongst the various health segments, the Group Health segment has witnessed fast growth primarily due to enhanced coverage, and rationalization of
discounts in premiums.
o Government schemes have broadly sustained their share due to the Ayushman Bharat scheme, and other medical options made available due to
pandemic-induced awareness. Further government schemes are being concentrated with the public sector general insurance companies.
o Overseas medical segment has returned to pre-pandemic levels as international travel has increased.
o SAHI’s generally focus on Retail, while general insurers account for a dominant share of the Group. Meanwhile, SAHI’s have managed to marginally
increase their share of the group segment. The premium growth of the SAHI continues to be higher than the industry average. Interestingly, private
players have grown faster than SAHIs, while public peers have grown at a slower pace.
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Non-Life Insurance Premiums Continue to Move Up in June 2023; Motor and Health Maintain Their High Share
• In Q1FY24, Motor insurance reached Rs 19,065.7 crore growing at 20.9% vs 33.4% in Q1FY23. Motor OD grew by 22.04% (vs. 37.7% for Q1FY23) and
Motor TP rose by 20.7% (vs. 30.7% for Q1FY23). Public sector companies grew faster than their private peers in the OD segment, albeit on a smaller base,
while underperforming in the TP segment.
The overall business growth will be further aided by improving profitability, stabilisation of loss ratios (which had increased during the pandemic), controlled
management expenses in accordance with regulations, and a favourable regulatory environment. Strengthening distribution networks, higher investment yields
due to the prevailing high-interest-rate environment, and the availability of growth capital will also contribute to the sector's growth.
However, it is important to note that recent flood-related damages in northern Indian states may have an adverse impact on claims for the general insurance
segment. Despite this, the overall outlook for the non-life insurance sector remains stable in the medium term. It is important to monitor factors such as intensified
competition, an uncertain international geopolitical environment, and high inflation, as these could potentially negatively affect economic growth and subsequently
impact the non-life insurance sector.
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Non-Life Insurance Premiums Continue to Move Up in June 2023; Motor and Health Maintain Their High Share
Annexure
Figure A1: Movement in Health Segment Premiums (Rs crore)
Total Premium Rs crore % Share YoY Growth
Segment
YTD FY22 YTD FY23 YTD FY24 YTD FY22 YTD FY23 YTD FY24 YTD FY23 YTD FY24
Health-Retail 6,382.9 7,169.1 8,461.6 37.4 33.7 32.9 12.3 18.0
Health-Group 9,324.0 12,112.6 14,922.5 54.7 56.9 58.1 29.9 23.2
Health-Government 1,290.6 1,714.3 1,968.3 7.6 8.1 7.7 32.8 14.8
Overseas Medical 54.4 283.3 342.1 0.3 1.3 1.3 421.2 20.8
Health Total 17,051.8 21,279.4 25,694.6 100.0 100.0 100.0 24.8 20.7
Source: General Insurance Council, IRDAI
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Non-Life Insurance Premiums Continue to Move Up in June 2023; Motor and Health Maintain Their High Share
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Non-Life Insurance Premiums Continue to Move Up in June 2023; Motor and Health Maintain Their High Share
Contact
Gaurav Dixit Director – BFSI Ratings [email protected] +91 - 11 - 4533 3237/ +91 - 97170 70079
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