Motor insurance industry experiences steady growth in October 2023 with increased competition. New-age insurers such as Digit and Acko see significant growth of 35-38% in motor insurance premiums. Standalone health insurers also show rapid growth, outpacing private general insurers. Overall, the non-life insurance industry grew at a modest pace of 10% year-on-year.
Despite the festive season, the motor insurance business saw mixed growth, with an overall 9% increase in premiums. Health insurance fared better, with 23% growth in retail health, driven by standalone health insurers and private general insurers.
Within the motor insurance landscape, the motor OD segment experienced 12% growth, while motor TP premiums declined by 7%. This growth coincided with a surge in domestic automobile sales in October 2023, including a 17% Y-o-Y increase in passenger vehicles and a 42% growth in two-wheelers.
Factors influencing the growth patterns in the motor insurance sector include potential strategies for lower tariffs or premiums by general insurers and a decrease in renewals for motor TP policies as a result of the mandatory 5-year third party insurance for Two-Wheelers, implemented in September 2018.
The report also highlighted a 23% Y-oY increase in the retail segment of the health insurance sector, a significant improvement. Standalone health insurers demonstrated a faster growth pace, surpassing private general insurers and marking a big improvement for public sector undertaking insurers.
However, the overall performance of group health premiums experienced an 8% Y-o-Y decline, primarily due to the decline of 42% Y-oY in public sector undertaking insurers’ contributions, affecting the collective performance of the sector.
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