Home / Companies / News /  Insurance penetration continues to remain low in India: Report

Insurance penetration of health and life insurance products continues to remain low in India, compared to global distributors, a report said. The report further added that in order to increase penetration it is crucial to reimagine distribution through traditional and newer channels.

The India Insurtech Association (IIA) collaborated with Boston Consulting Group (BCG) to release the second edition of the insurtech report, India Insurtech Landscape and Trends Report, which identifies dominating trends and key player’s views in the Indian insurtech sector. It was launched at IIA’s Annual Event 2022 on 23 April.

According to the report, rapid funding in insurtech has continued across the globe, and has also seen strong momentum in India. Global funding in insurtechs has grown 7X in the last 5 years, from $2.5 billion in 2017 to $14 billion in 2021, with growth continuing even during the pandemic period. Insurtech funding in India has also doubled in the last 2 years, from $290 million in 2020 to $800 million in 2021. There has been a steady rise in the number of insurtech unicorns globally, with over 20 unicorns in 2021-- 14 in United States, 4 in UK, 2 each in India (Acko & Digit Insurance ) & France , 1 each in Austria , Israel & Mexico

Experts believe insurtechs in India are well-positioned to cater to the nuanced needs of customers, and are at the cusp of exponential growth.

Subhajit Mandal, co-founder of India Insurtech Association said , “We are highly optimistic about the Indian insurtech landscape in the next few years. The sustained funding levels over last couple of years has helped launch multiple insurtech startups, which is key for innovation. Enablers such as India Stack, Insurance Information bureau and the regulatory sandbox have provided a strong platform for innovation in insurance value chain".

Jitesh Shah, MD & Partner BCG Asia Pacific Lead, Operations in Financial Institutions at BCG said “As the sector experiences unprecedented growth, it is critical to continue collaboration between insurers and insurtechs. It is also important for the industry to keep innovating to address important issues such as deeper insurance penetration, customer health and wellness, etc. To ensure that the sector experiences continued growth, there is a need for key enablers such as the National Health Stack, regulatory sandbox and Insurance Information Bureau."

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