Public Sector Insurers Bounce Back in FY26
Public sector insurers in India are experiencing a notable resurgence in the first half of FY26. After facing declining market shares in previous years, these companies have gained ground, raising their market share to 31.7% as of September 2025. This shift is particularly highlighted by the impressive performance of New India Assurance, which increased its share significantly to 13.25% from 12.60% a year earlier.
In contrast, private sector insurers like ICICI Lombard have seen a decline, with their market share dropping to 8.68% from 9.36%. Other private players like Star Health Insurance and HDFC Ergo also reported decreases in their market shares. This reflects the shifting dynamics within the insurance sector, where public companies are regaining consumer trust and market presence.
The overall growth of the non-life insurance sector stood at 7.31%, amounting to Rs 1,65,156 crore. This marks an uptick from the previous year’s growth rate of 7.03%. The sector saw a significant recovery, with September 2025 recording a year-on-year growth of 13.2%, in stark contrast to the 6.5% decline noted in September 2024. The premium collection reached Rs 31,117.6 crore, driven by strong renewals in sectors like motor and crop insurance.
One of the key factors contributing to this revival is the recent reduction in Goods and Services Tax (GST) on health insurance, which has made policies more affordable. As a result, there has been an increase in policy sales and improved compliance within the sector. Priyesh Ruparelia of CareEdge Ratings noted that this reduction enhances affordability and increases penetration in the market.
Health insurance remains the largest segment in the non-life insurance industry, with a growth of 6.9% in September 2025. However, affordability pressures due to rising premiums have moderated the overall growth momentum. The retail health segment grew rapidly, aided by GST cuts and policy renewals, but still saw a decline in growth rate compared to the previous year.
Specialized insurers have also witnessed a remarkable rebound, with premiums soaring by 261.5% year-on-year in September 2025, reversing a previous contraction. This growth signifies a renewed momentum and a recovery across specialized lines.
In conclusion, the public sector insurers in India are on an upward trajectory, regaining market share amidst fierce competition. With favorable regulatory changes and increasing demand for insurance products, the future looks promising for the non-life insurance sector in India.
