General Insurance Premium to Reach Rs 3.7 Lakh Cr by FY26: Report

New Delhi, May 27 (PTI) The general insurance industry is expected to earn a gross direct premium income (GDPI) of Rs 3.7 lakh crore by FY26, an increase of 32 per cent from Rs 2.8 lakh crore in FY24, a report said.

While the growth for private insurers is expected to remain strong and that of PSU insurers is likely to remain moderate because of the weak capital position, ICRA said in a report.

The profitability for private insurers is likely to improve, supported by better underwriting performance, it said.

The combined ratio for PSU insurers will remain weak, thereby impacting the net profitability, the report said.

The industry's GDPI saw a robust 15.5 per cent year-on-year (YoY) expansion in 2023-24, rising to Rs 2.79 lakh crore on the health segment, it said.

Apart from this, the report said that the growth in the motor segment was healthy, supported by the increase in new vehicle sales (two-wheelers, or 2W, rose by 13.3 per cent YoY and passenger vehicles, or PVs, by 8.4 per cent YoY in 2023-24).

With the high frequency and severity of natural catastrophic events in 2023-24, the net loss ratio of the fire segment was impacted. However, considering the reinsurance and low retention in this segment, the impact on the overall net loss ratio of the industry was manageable, ICRA said.

The profitability for private players remained strong supported by improved investment income, which is likely to continue, it added.