Standalone health insurers gain market share as general insurers lose ground

In India's non-life insurance market, standalone health insurers are rapidly gaining market share, while traditional general insurers are losing ground, according to data from the General Insurance Council (GI Council). Standalone health insurers now hold 14.10% of the total non-life insurance premium, up from 11.72% a year ago.

This represents a significant gain of 2.38 percentage points. Conversely, general insurers' share declined to 85.34% from 86.43%, a drop of 1.09 percentage points. This market shift is particularly evident when examining premium collections. While general insurers recorded a 8.09% increase in gross direct premium to Rs 101,812 crore, standalone health insurers grew much faster at 31.74% to Rs 16,827 crore.

The trend aligns with the broader pattern observed in FY26, when standalone health insurers' market share had already risen to 13.6% from 12.5%. The sector's growth can be attributed to strong demand for health cover and the removal of GST on retail health insurance, both of which have made policies more affordable and popular. Among the five largest general insurers, performance has been mixed.

New India Assurance, the largest, saw its market share drop to 14.27% from 15.08%, while its premiums increased by 3.58% to Rs 17,023 crore. ICICI Lombard, the second-largest, saw a decline in market share to 8.99% from 9.38%, despite a 4.95% rise in premiums to Rs 10,723 crore. United India Insurance remained relatively stable, with a slight decrease in market share to 7.19% from 7.24%, and a 8.69% increase in premium to Rs 8,572 crore.

In contrast, Tata AIG General Insurance, Bajaj General Insurance, and other players saw significant growth. Tata AIG increased its market share to 7.07% from 5.91%, while Bajaj's market share rose to 6.83% from 6.67%, with both insurers experiencing double-digit growth in premiums. Together, these five largest general insurers accounted for about 44.35% of the overall non-life premium market, almost unchanged from 44.28% a year earlier.

This suggests that the general insurers' share loss is not solely due to smaller insurers gaining ground. Instead, standalone health insurers are capturing an increasing portion of the overall insurance premium pool. The top three standalone health insurers - Star Health, Care Health, Niva Bupa, and Aditya Birla Health Insurance - all showed strong growth, with Aditya Birla Health Insurance recording the highest increase of 45.06%.

However, it's important to note that the Insurance Regulatory and Development Authority of India (IRDAI) revised its reporting format on October 1, 2024, which may affect the direct comparability of growth rates with previous years. Despite this, the broader trend is clear: standalone health insurers are growing significantly faster than general insurers, solidifying their position in India's increasingly health-focused non-life insurance market.