HomeFinancePersonal Finance26% growth in health insurance premium recorded; 12% of claims related to...

26% growth in health insurance premium recorded; 12% of claims related to covid-19 – ICRA

Credit Source


ICRA expects the general insurance industry’s gross direct premium income (GDPI) to grow by 10-12% in FY2023, led by higher growth in the health and commercial business segments with increasing awareness of medical insurance and uptick in economic activity.

Already the resumption of economic activity after the waning of Covid-19 infections, has led to the industry’s gross direct premium income (GDPI) growth recovering by an estimated 11% in FY2022 (compared to a 4% growth in FY2021).



The GDPI of PSU insurers is expected to grow moderately at 4-6%, while private insurers are expected to capture market share by growing at a higher rate of 13-15% in FY2023. However, economic uncertainty due to structural challenges in the automobile industry and rising commodity prices amid the geopolitical crisis pose downside risk to FY2023 growth.



Giving further insights, Sahil Udani, Assistant Vice President & Sector Head – Financial Sector Ratings, ICRA, says, “The GDPI of private sector insurers grew at a faster rate of 14% (E) compared to the growth of 5% (E) witnessed by public sector undertaking (PSU) insurers in FY2022. The gross premium from the health segment experienced a steep Y-o-Y growth of 26% in 11M FY2022, while the fire segment premium grew by 8% in 11M FY2022 despite partial lockdowns across the country.

Post the decline in FY2021, the motor business reported muted growth of 4% in 11M FY2022 on the lower base due to structural challenges in the automobile industry. However, the GDPI from the crop business declined by 20% in 11M FY2022 mainly due to the significant decline in the PSU business.”

The combined ratio across the industry deteriorated to 119% in 9M FY2022 from 112% in 9M FY2021 with increase in health claims. Covid claims accounted for 6% of the total number of health claims paid in FY2021 and are expected to form around 11-12% of the total number of health claims paid in FY2022.

The combined ratio for the industry is expected to improve in FY2023 driven by lower health claims and likely improvement in risk pricing by the insurers.





Read Full Article

Stay Connected

4,989FansLike
4,001FollowersFollow

Must Read

Related News

LEAVE A REPLY

Please enter your comment!
Please enter your name here