New Delhi: The total premium collection of both the life and property insurance industry is expected to exceed $11.2 billion by 2012-13, a study has said.
“The property and casualty insurance industry would exceed Rs500 billion ($11.2 billion) in total premiums by 2012-13 from the current level of close to Rs370 billion ($8 billion) in 2009-10,” according to a study jointly done by industry chamber Assocham and research firm McKinsey & Company.
Given the macro-economic situation, the underlined demand for property and casualty insurance will continue to grow as players compete aggressively for market share, resulting in low pricing levels across both the personal and commercial segments, Assocham president Swati Piramal said.
Since the deregulation of the insurance sector in 2000, the property and casualty insurance sector has been growing steadily, the study said.
This growth has been primarily driven by private sector players, whose premium collections grew by 40% between 2003-2004 and 2009-2010, as compared to 8% for public sector layers over the same period, the study said.
However, on an absolute and relative basis, compared to other markets and other financial asset classes, penetration levels in India are extremely low, it said.
The low penetration in the Indian market is the result of a combination of low asset ownership levels and low usage levels of insurance.
Between 1994-1995 and 2008-09, the relative increase in penetration was only 1.6 times for property and casualty insurance, as compared to 1.8 for mutual funds, 4.2 for life insurance and 5.3 for mortgage.