IRDAI Report: Claims Ratio of Non-Life Insurers Declines to 82.5% in FY24

Current Context: The report is titled "Annual Report 2023-24" by the Insurance Regulatory and Development Authority of India (IRDAI). It was released on December 23, 2024.

• Here are some key highlights:
• Claims Ratio: The claims ratio for non-life insurers declined slightly to 82.52% in FY24, compared to 82.95% in FY23.
• Insurance Penetration: Insurance penetration in India was 3.7% in FY24, down from 4% in FY23.
• Premium Growth: The non-life insurance sector saw a 12.76% growth in direct premiums, reaching Rs 2.90 lakh crore.
• Profitability: The sector turned profitable with a combined net profit of Rs 10,119 crore in FY24, compared to a net loss of Rs 2,566 crore in FY23.

Question:

1 How did India's insurance penetration rate change from FY23 to FY24?

• A) Increased from 3.5% to 4%
• B) Declined from 4% to 3.7%
• C) Remained constant at 3.7%
• D) Increased from 3.7% to 4%

Answer: B) The insurance penetration in India decreased from 4% in FY23 to 3.7% in FY24. Insurance penetration is the ratio of premium underwritten to GDP, reflecting the market's depth.