The public sector general insurance companies (PSGICs) in India have shown a significant improvement in their performance, according to a review meeting chaired by Finance Minister Nirmala Sitharaman. The total premium collected by these companies has increased from approximately ₹80,000 crore in 2019 to nearly ₹1.06 lakh crore in 2025, indicating a marked improvement in their business metrics. All four public sector general insurers, including Oriental Insurance Company Ltd., National Insurance Company Ltd., United India Insurance Company Ltd., and New India Assurance Company Ltd., have returned to profitability.
The review meeting highlighted that Oriental Insurance Company Ltd. and National Insurance Company Ltd. started posting quarterly profits from Q4 of FY 2023-24 and Q2 of FY 2024-25, respectively. United India Insurance Company Ltd. recorded a profit in Q3 of FY 2024-25, marking a return to profitability after a gap of seven years. New India Assurance Company Ltd., the market leader among the four, has consistently posted profits.
Despite this progress, the general insurance penetration in India remains low, at 1% of GDP, compared to the global average of 4.2% in 2023. However, insurance density has shown steady growth, increasing from $19 in 2019 to $25 in 2023. The Finance Minister emphasized the need for PSGICs to enhance both penetration and density to provide broader financial protection to the population.
The review meeting also presented a five-year analysis of the health insurance segment, which showed sustained premium growth across private insurers, standalone health insurers, and PSGICs. The incurred claims ratios, which had spiked during the COVID-19 pandemic in FY21, have since moderated. By FY24, the ratios had declined to 103% for PSGICs, 89% for private insurers, and 65% for standalone health insurers. This indicates that the health insurance segment is becoming more stable and profitable for insurers.
Overall, the review meeting highlighted the significant turnaround in the performance of PSGICs and the need for them to continue to improve their business metrics and provide broader financial protection to the population. The growth in the health insurance segment is also a positive sign, indicating that the insurance industry is becoming more stable and profitable. However, there is still a long way to go to achieve higher insurance penetration and density in India.