IRDAI Annual Report 2024-25 Highlights

Every year, IRDAI publishes a report on the state of India’s insurance industry. Most people never read it. It runs into hundreds of pages. It is full of tables and regulatory language.

But reading it can make a difference. Inside that report is information that directly affects your policy. Your premium. Your claim. Your rights.

The IRDAI Annual Report 2024‑25 covers April 2024 to March 2025. We have read it and distilled it, so you do not have to read the full 400+ pages. This article pulls out what actually matters to you. Whether you are buying insurance for the first time, reviewing your coverage, or wondering why your health premium went up, this is for you.

What Is the IRDAI Annual Report?

IRDAI is required by law to publish its annual report every year. It goes to the Central Government. It covers the whole industry: what grew, how claims were paid, what people complained about, and what rules changed. Think of it as a mandatory public report card.

For buyers, it is most useful as a filter. It does not tell you which specific plan to buy. But it tells you what is happening at the industry level: where complaints are rising, where claims are under pressure, and what new protections you now have.

Used well, it helps you ask smarter questions before buying a policy. In this article, we focus only on 6 insights from this report that actually affect your premiums, claims, and financial security.

#1 India’s Insurance Market: The Big Picture

Let us start with the numbers that set the scene.

India is the 10th largest insurance market in the world. Total insurance premiums in 2024-25 were around USD 141 billion. That sounds big.

But look at insurance penetration. It measures how much of a country’s GDP goes into insurance premiums. India is at just 3.7%. The global average is 7.3%. We are at roughly half the world average.

Last year, life insurance penetration actually dipped. It fell from 2.8% to 2.7% in FY25. Non‑life insurance penetration stayed flat at 1.0%.

What does this mean? Most Indians are still underinsured. People who already have insurance are paying more. But not enough new buyers are getting covered. This is the gap that IRDAI’s vision, Insurance for All by 2047, is trying to close.

As of March 2025, there were 74 registered insurers and reinsurers in India. That included 26 life insurers, 25 general insurers, 8 standalone health insurers, 2 specialised insurers, and 13 reinsurers. A new reinsurer, ValueAttics Reinsurance Limited, got its registration in March 2025.

Total industry assets under management crossed ₹74.43 Lakh Crore. That is a 10% jump in one year. Insurance is not just protection. It is one of the largest savings pools in the country.

#2 Life Insurance: Premiums Up, But Fewer People Getting Covered

The life insurance industry collected ₹8.86 Lakh Crore in total premium in FY25. That is a 6.73% growth. Private insurers grew 12%. LIC grew 2.75%.

So premiums are growing. But here is the uncomfortable truth.

The number of new individual policies sold fell by 7.4%. From 291.77 Lakh in FY24 to 270.22 Lakh in FY25. LIC’s policy count dropped 12.8%. Private insurers grew 5.2%.

“Premium up, policies down” is a pattern worth noting. It means the industry is collecting more from existing customers: more renewals, higher ticket sizes. But it is not bringing as many new people under cover. For a country where most people have inadequate term insurance cover, that is a concern. 

On the financial side, life insurers reported an 18.14% jump in profit. Profit after tax reached ₹56,006 Crore (source‑based figure; exact amount may vary slightly across compilations). The industry is doing well financially. But profitable insurers have less pressure to cut premiums.

One number that matters most to claimants is the claim settlement ratio. For individual life policies, insurers settled 97.82% of death claims by number. That means roughly 2 in 100 claims were repudiated or rejected. For group policies, the settlement rate was 99.68%. These are industry averages. Your specific insurer’s ratio can be very different. Always check claim settlement records before buying.

#3 Health Insurance: The Fastest-Growing Segment

Health insurance was the largest segment in non-life insurance. It made up 41.42% of total non-life premiums. General and health insurers collected ₹1,27,417 Crore in health premiums in FY25. That is 9.19% growth.

Around 58 Crore lives are covered under health insurance today. But here is how that coverage breaks down. Government schemes cover 42.3% of those lives. Group or employer policies cover 47.4%. Individual retail policies cover just 10.3%.

This matters. If your health cover is through your employer, you are protected only while you are employed there. The moment you leave, or retire, you could be left uninsured. Individual coverage is what follows you through life. 

If you’re relying only on employer health insurance, this is where most people go wrong.

You can review your coverage gaps before they become a problem.

Claims tell another important story. Insurers processed 3.26 Crore health claims in FY25. They paid out ₹94,248 Crore. The average claim paid was ₹28,910. About 58% of claims were settled cashlessly.

But look at the settlement outcomes. 87% of claims were settled. 8% were repudiated. About 5% were still pending at year end. That 8% repudiation rate means roughly 1 in 12 health claims does not get paid. It could be due to waiting periods, pre-existing conditions, or documentation gaps. Knowing why is something every policyholder should learn before they need to file a claim.

#4 General Insurance: Motor, Fire, and Underwriting Pressure

Motor insurance collected ₹99,093 Crore in FY25. That is 7.97% growth. It makes up about 32% of the total non-life premium.

One useful development this year was that IRDAI introduced Pay as You Drive insurance products. Your premium is linked to how many kilometres you actually drive, not a flat annual rate. If you drive infrequently, you may be able to save.

Fire insurance premiums fell 5.58%. IRDAI also de-notified all prevailing policy wording tariffs for fire, motor, engineering, and marine from April 2024. The market is now more deregulated on pricing. Insurers compete more freely. For buyers, this means you should compare multiple insurers rather than assuming prices are standard.

The overall non-life industry reported an underwriting loss of ₹30,276 Crore in FY25. Do not panic. Insurers still made a collective profit of ₹13,154 crore, largely from investment income. But underwriting losses create pricing pressure. When insurers pay out more than they collect, they typically raise premiums. This is why your general insurance premium may have gone up.

Three public sector general insurers, National, Oriental, and United India, had negative solvency ratios as of March 2025. National was at -0.67, Oriental at -1.03, and United India at -0.65. The required minimum is 1.5 (150%). These are state-backed entities, so the government provides a safety net. But solvency ratios are worth checking when you choose a non-life insurer. Price alone should not be your only criterion.

#5 Grievances Are Rising: What It Means for You

This section of the report tells you the most about how insurers treat customers in practice.

In FY25, the Bima Bharosa portal recorded 2,57,790 grievances. That is a 20% jump from 2,15,569 in the previous year. Life insurance had 1,20,429 complaints. General and health insurance had 1,37,361.

General and health insurance complaints grew by nearly 45% in a single year. The biggest reason? Claims. About 69% of general insurance grievances were about claims: delays, underpayments, or rejections.

For life insurance, 26,667 complaints were tagged as Unfair Business Practices (UFBP). That is up 14% from 23,335 the year before. UFBP is the regulatory language for mis-selling. An agent made false promises. A product was explained wrongly. Pressure was used to close a sale.

Here is the practical takeaway.

The agent who said “this ULIP gives guaranteed 12% returns” was wrong. The bank representative who sold a single-premium policy as a “better fixed deposit” was mis-selling. These practices are still common. The complaints data proves it.

​​If claims experience is your biggest concern, this is exactly what you should focus on when buying a policy. Never rely on verbal promises. Everything that matters must be in the policy document and the benefit illustration. The rest is noise.

#6 The New Protections IRDAI Has Put in Place

FY25 was one of the most active years for regulatory change in Indian insurance. IRDAI issued 12 Master Circulars, combining hundreds of older, scattered guidelines. Here are the ones that matter most to you as a buyer.

Customer Information Sheet (CIS)

Every policy, life, health, or general, must now come with a CIS. It is a plain-language summary. It covers what is included, what is excluded, waiting periods, deductibles, how to claim, and how to escalate. If you have bought a policy recently and did not receive one, ask your insurer for it.

Bima-ASBA

This is a new way to pay premiums. It works like the ASBA system for IPOs. When you apply for insurance, your premium is blocked in your bank account until the insurer accepts your proposal. It is not debited. If the insurer rejects your application, the money is released automatically. No follow-up needed. No chasing for refunds.

Cashless Claims: Faster, With Accountability

For health insurance, insurers must now give pre-authorisation for cashless hospitalisation within 1 hour. Discharge approvals must come within 3 hours. If an insurer causes delays beyond these timelines, they must bear extra costs from their own funds. This is a meaningful step for patients who were stuck waiting at hospital reception.

Ombudsman Awards: Now With Teeth

If you escalate a complaint to the Insurance Ombudsman and win, the insurer must comply within 30 days. Failure to comply now attracts a penalty of ₹5,000 per day. The Ombudsman compensation limit has also been raised from ₹30 Lakh to ₹50 Lakh. Knowing this changes how you approach a dispute. Escalation has real consequences for insurers now.

60-Month Moratorium for Health Insurance

Once you have held a health policy for five continuous years, no claim can be rejected for non-disclosure or misrepresentation. The only exception is proven fraud. This is important for people with pre-existing conditions who worry about past non-disclosure.

Health Insurance Premium Hike for Senior Citizens

In January 2025, IRDAI stepped in with an important protection. Insurers can now increase senior citizen health insurance premiums by a maximum of 10% per year without prior IRDAI approval. Any insurer wanting to raise it beyond that, or withdraw products for seniors, must consult IRDAI first. 

Policy Loans on Life Insurance Savings Products

Policy loans are now mandatory in all savings-linked life insurance products. If you have an endowment or traditional life plan, your insurer must let you borrow against it. You get liquidity without cancelling your policy.

30-Day Free-Look Period

A uniform 30-day free-look period now applies to all health and life insurance policies with a term of one year or more. You have 30 days after receiving the policy wording to review it. If you find problems, you can cancel for a full refund. Use this every time you buy a new policy.

Technology Is Reshaping How Insurance Works

The IRDAI Annual Report shows how quickly technology is entering Indian insurance.

Insurers are using AI for underwriting, motor claim processing, health claim handling, and fraud detection. Some insurers introduced GenAI chatbots in regional languages. Others launched WhatsApp-based service tools. Several use Account Aggregator data for automated financial underwriting, without needing physical documents.

For customers, this cuts both ways.

A tech-forward insurer can settle your claim faster and with less paperwork. But AI systems can also auto-flag or reject claims based on pattern matching. If your claim documents are incomplete or inconsistent, you may face friction. This makes proper documentation, pre-authorisation letters, discharge summaries, itemised bills, more important than ever.

The 2047 Vision: What It Means

Almost every initiative in this report connects to one goal: “Insurance for All by 2047.”

The target is that every Indian citizen has suitable life, health, and property insurance by India’s centenary. Two structural changes are worth knowing about.

Rural and Social Sector Obligations

Life insurers have been assigned 25,000 specific Gram Panchayats. In each, they must ensure at least 10% of the population is insured. General insurers must cover dwellings, shops, and vehicles in their allocated Gram Panchayats.

If you live in a smaller town or rural area, this should translate to more insurers actively trying to reach you. Expect simpler, more affordable products targeting rural buyers in the years ahead.

Bima Sugam

IRDAI is building Bima Sugam, an Insurance Electronic Marketplace. Think of it as UPI for insurance. You will be able to buy a policy, service it, and file claims through a single digital platform. The regulations were notified in 2024. The platform is still being built. But it signals where the industry is going.

How to Use the IRDAI Annual Report as a Buyer

You now have a full picture of what the report says. Here is how to use it.

• Use complaint data to shortlist and eliminate insurers. A health insurer with rapidly rising claims-related complaints is telling you something. Do not compare raw complaint numbers alone. Large insurers always have more total complaints. Look at complaints per 10,000 claims. That normalises for size.
• Check solvency ratios before choosing a general insurer. A ratio comfortably above 1.5 is reassuring. The fact that three public sector general insurers are below the minimum is a reason to consider this alongside price.
• Know your new rights and use them. The CIS, the 30-day free-look period, Bima-ASBA, the 60-month moratorium, the 1-hour cashless authorisation rule, and Ombudsman escalation all exist to protect you. If your current policy did not come with a CIS, ask for one today.
• Do not use the report as a plan ranking. It does not tell you which specific plan to buy. It describes the market and the regulatory environment. Picking the right plan still means reading the policy wording, checking network hospitals, verifying sub-limits and exclusions, and matching coverage to your family’s actual needs.
• Watch the mis-selling signals. Rising UFBP complaints are your reminder: any verbal promise not in the policy document is not binding. Read the CIS and the benefit illustration. Not the sales pitch.

IRDAI Annual Report 2024-25 Summary

The IRDAI Annual Report 2024-25 shows an industry that is growing, but still has a long way to go.

Premiums are up. Profits are up. The regulator is pushing meaningful consumer protections. Technology is making claims faster. The reforms this year are among the most comprehensive in IRDAI’s 25-year history.

But insurance penetration is still stubbornly low. Grievances are rising sharply in health and general insurance. Some public sector general insurers are in financial stress. And millions of Indians are either uninsured or relying on group or government coverage that will not follow them through life.

The regulator is working on the structural gaps. 

But your financial security does not wait for 2047. The insurer, policy, and coverage you choose today determine whether your family is protected when it actually matters.

If you want to understand how these trends apply to your specific situation, whether your current coverage is adequate, what you might be missing, or which plan is right for you, talk to us at Algates Insurance. We are IRDAI-certified advisors. We help you make these decisions without a sales agenda. Just an honest look at what works for your life and your family.

Disclaimer: This article is for information and education only and is based on the IRDAI Annual Report 2024-25 and related public circulars. It is not a substitute for personalised financial or legal advice. Always refer to your policy documents and consult a qualified advisor before making decisions. Algates Insurance is an IRDAI-registered Insurance Marketing Firm (IMF Code: IMF187250600920210470).