India’s insurance market set to triple by 2035, poised to overtake Japan: Allianz Global

India is set to emerge as the fastest-growing insurance market in the world, according to the Allianz Global Insurance Report 2025. With a projected annual growth rate of 11.5%, India is on track to overtake Japan and become the second-largest insurance market in Asia, the report said.

Strong demand for protection products and underpenetration continue to fuel this surge, positioning India as the fastest-growing insurance market globally.

In 2024, the Indian insurance market

expanded 10.6%, outpacing even the previous year’s robust 7.7% growth. While all segments contributed to the rise, health insurance led the surge with a 20.8% jump, followed by life insurance at 10.6%—the largest segment, contributing nearly 75% of all premiums.

Property & casualty (P&C) insurance posted a solid, though slightly slower, growth of 7.9%.

“India is the real growth champion in Asia,” the report noted, predicting that India’s life insurance market will soon overtake Japan, making it the second-largest in the region after China.

Despite this rapid expansion, the report highlighted India’s untapped potential. Average household insurance spending in India stands at just $100, less than one-fifth of what Chinese households spend, pointing to significant room for growth.

Globally, insurance premiums grew 8.6% in 2024, adding $577 billion and pushing total premiums to $7.3 trillion. Life insurance was the top performer worldwide, driven by higher interest rates and rising demand for annuities, especially in North America and China.

The report also emphasised the broader context fueling insurance demand—economic uncertainty, climate risks, and aging populations.

“Insurance remains a growth industry,” said Ludovic Subran, Chief Economist at Allianz. “But this growth is largely fueled by policy inaction—underinvestment in climate adaptation and delayed pension reforms.”

Looking ahead, Allianz expects the global insurance market to grow at 5.3% annually over the next decade. India’s health insurance segment is projected to be the most dynamic, growing at a staggering 18.5% per year, as millions seek coverage amid limited public healthcare.

Asia (excluding Japan) will dominate global premium growth, generating over $1.1 trillion in additional life insurance premiums by 2035—more than North America and Western Europe combined.

As India cements its place at the forefront of this transformation, the report makes it clear: the country’s insurance future is not just promising—it’s exponential.

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