How reinsurers can help bridge India's huge protection gap

Subscribe to enjoy similar stories. India’s insurance industry is growing rapidly, supported by robust economic growth, an expanding middle class, innovation and strong regulatory support. According to data from the Swiss Re Institute, total insurance premium collections are projected to grow by 7.1% over the next five years (2024–2028).

This growth rate significantly surpasses the global average of 2.4%, the 5.1% growth in emerging markets, and the 1.7% average in advanced markets. Over the next decade (2024–2034), total premiums are estimated to more than double after adjusting for inflation, with insurance penetration expected to rise from 3.8% currently to 4.5% by 2034. India is inherently vulnerable to numerous catastrophic natural disasters.

Its varied topography, which includes mountains, plains, and coastlines, exposes each region to specific natural catastrophe risks. The average annual economic loss over the last decade (2013‒22) was $8 billion (inflation-adjusted), 125% higher than the average of the previous decade ($3.8 billion, 2003‒12), accorning to Swiss Re Institute. Since the turn of the century, there have been a number of large-loss flood events including in Mumbai in 2005, Uttarakhand (Kedarnath) in 2013, Jammu and Kashmir in 2014, Chennai in 2015, Kerala in 2018, and northern India including New Delhi in 2023.

Single flood events that cause economic losses of more than $1 billion have become more regular. There were 11 such events in 2013‒22 compared with six in 2003‒12. Also read: One of India's top PMS funds stakes its revival on manufacturing and energy transition Tropical cyclones also strike India, typically in West Bengal, Odisha, Andhra Pradesh and Tamil Nadu on the east coast, and Gujarat on