Market participants say health insurance saw a muted growth due to the slowdown in retail health insurance and the subdued growth in group health business.
Even the government's health schemes and overseas medical saw fall in premiums this fiscal till November.
Non-life insurers clocked premiums of Rs 14,981.04 crore in November, compared with Rs 14,585.91 crore in the same month last year, a growth of 2.71%. The growth in premiums was led by motor insurance and health insurance, while crop insurance witnessed a fall in premiums.
Data from Kotak Institutional Equities show that motor insurance saw gross direct premium of Rs 6,351.6 crore in November this year, against Rs 5,948.2 crore in November 2019, an increase of 7%. Health insurance grew by 2% to Rs 4,041 crore and crop insurance witnessed a fall of 10% in premiums at Rs 1,869.3 crore, compared with Rs 2,083.4 crore in the year-ago period.
Market participants say health insurance saw a muted growth due to the slowdown in retail health insurance and the subdued growth in group health business. “Slowdown in growth in retail health was likely an interplay of slowdown in daily new Covid-19 cases in India and lower volumes during the festive season,” said Kotak Institutional Equities in its report.
Even the government’s health schemes and overseas medical saw fall in premiums this fiscal till November. The data from the General Insurance Council show that government health schemes saw premiums of Rs 2,041.41 crore in the current fiscal, compared with Rs 3,027.17 crore in the previous year, a fall of 32.56%.
However, robust festive demand, a gradual rise in freight volumes and utilisation rates supported premiums in the motor insurance. Motor premiums have gradually improved from trough levels observed in April and May and will likely improve further, say market participants.
According to CARE Ratings, the non-life insurance business witnessed a fall in Q1FY21, but recovered in Q2FY21 primarily due to the health segment. The industry is expected to grow in the single digit this year. Overall, the outlook is stable in the medium term.