Mumbai: India’s insurtech sector has delivered 12 times revenue growth over the last 5 years, with cumulative funding surpassing $2.5 billion and ecosystem valuation over $13.6 billion, a report showed on Wednesday.
The country has more than 150 insurtech companies, with 10 unicorns and soonicorns and more than 45 minicorns, with 12 times increase in revenue over the past five years to reach $750 million, according to the report by Boston Consulting Group (BCG) in collaboration with the India InsurTech Association (IIA).
“Most of the insurtechs at scale are present in the aggregation and distribution legs of the value chain, with these accounting for over 80 per cent of the funding. There is a substantial opportunity for insurtechs to leverage data and technology in underwriting and claims, which can play a critical role in the continued growth of the insurance industry,” said Pallavi Malani, Managing Director and Partner, Lead-India Insurance Practice at BCG.
Although India has made significant progress, increasing penetration still remains a priority, particularly in health insurance with 45 per cent of medical spend still being out of pocket.
Multiple macroeconomic tailwinds are already driving growth in the industry. The goal is to achieve 100 per cent coverage for all citizens and reduce out-of-pocket medical expenses to less than 10 per cent, the report mentioned.
India envisions becoming the world’s third-largest insurance market, with over 10 companies in the global top 50 and more than 100 insurtechs operating at scale.
“As India aspires to become a developed economy, there are substantial opportunities across three pathways: higher accessibility, increased awareness and trust, and enhanced affordability,” said Vivek Mandhata, Managing Director and Partner at BCG.
As the insurtech landscape evolves, more than 75 per cent of insurtechs are prioritising to building profitable operating models.
Additionally, over two-thirds are fostering strategic partnerships and expanding into new geographies.
“The evolving insurtech landscape clearly demonstrates that collaboration is not just an option but a strategic imperative for achieving Viksit Bharat – the vision for 2047,” said Subhajit Mandal, Cofounder at India InsurTech Association.
–IANS