Insurance penetration in India is low, particularly for general insurance, which includes motor, health, property and liability covers. We buy about Rs750 of general insurance per person per year compared to over Rs6,500 in Russia, China or Brazil, according to a report by the International Monetary Fund (IMF). If we measure premiums as a proportion of GDP, India is at 0.7% as compared to a world average of 2.8%. General insurance is colloquially referred to as non-life, a reflection of its poor-cousin status compared to the larger life insurance sector.
It is important, however, that more people buy general insurance. A well-developed general insurance industry mitigates the risk of ill-health, accidents, catastrophes and litigation. In its technical note on insurance sector regulation and supervision in April 2018, IMF identified poor insurance penetration as a major industry priority.
