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Increased competition, capacity and engagement have improved the Indian reinsurance market conditions at the recent April renewals, according to a market update by Aon, a risk management and professional services firm.
Aon disclosed that reinsurers are keen to grow in the region, as most placements achieved single-digit reductions for property reinsurance, compared with slight increases in 2024 and 2023.
Due to strong underlying demand, many reinsurers went to make in-person visits to local insurers. Given the country’s huge protection gap, reinsurance demand remains strong, supported by the country’s fast-growing insurance market, driven by government initiatives to close the gaps, drive economic growth, and increase natural catastrophe exposures.
The re/insurance broker stated, “Demand remains strong, supported by a growing economy and low penetration rates, as well as emerging opportunities from specialty lines, such as cyber and surety, as well as agriculture and health insurance. Most placements are purchasing limits as expiring, although reinsurers are pushing for increased deductibles for catastrophe excess of loss, leading to a slight increase in overall reinsurance capacity.”
April 1 is the main renewal for India, as most insurers purchase reinsurance protection across all lines of business. When compared year on year, conditions at April 1 were more favourable, with increased capacity and reinsurer engagement resulting in modest reductions in risk-adjusted rates.
India has not seen a major catastrophe loss event so far in 2025. In 2024, insurers paid losses driven by Cyclone Remal and widespread flooding in May, August and September. Several large fire losses affecting the power sector will likely impact treaty and per-risk reinsurance renewal negotiations for affected insurers, although these claims are currently still outstanding. Aon explains, rapid economic growth and urbanisation contribute to a large portion of the global catastrophe losses in emerging markets like India and China.
Outside of the property sector, in India, Aon states that cyber reinsurance demand is set to increase as insurers respond to the growing demand for standalone cyber insurance from Indian companies, explained Aon. Historically, limited reinsurance protection for cyber is provided under Indian insurers’ liability reinsurance treaties.
Aon believes that the reinsurance demand is increasing in India’s surety market, a product that was until recently offered only by banks. The government supports Indian insurers’ launch of surety products, creating demand for reinsurance protection in this growing sector. The broker believes that there are growing opportunities in health over the next years, as more insurers launch health insurance products under the Indian government’s subsidized scheme.
India is one of the world’s largest agriculture insurance markets, although most state schemes purchase their reinsurance on multi-year deals, up for renewal in 2026. The sector continues to receive the strong support of reinsurers, having produced positive results for the past five years. Aon stated there is an opportunity for further Indian states to join the government scheme in 2026, creating additional potential demand for reinsurance capacity. Stop-loss agriculture treaties are renewed annually, and can expect modest reductions in rates at renewals due to recent positive performance.
Aon sees an opportunity in the nascent livestock and aquaculture markets for both insurers and reinsurers as the government is looking to use technology to expand the national livestock insurance scheme. While still a small market, insurers are in the early stages of exploring products for India’s growing aquaculture sector. In both cases, reinsurer capacity and expertise are paramount.
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