According to IRDAI Chairman Ajay Seth, major changes are taking place in the life insurance sector. Insurance products will come on the digital platform ‘Bima Sugam’ by September and a paper on distribution reforms will be released in July. The sector has grown 2.5 times in the last 10 years.
In the last decade, along with the country’s economy, the top line of the life insurance sector has also grown by 2.5 times, which is an important milestone. Along with this growth, major structural changes are also taking place in the sector. Insurance Regulatory and Development Authority of India (IRDAI) Chairman Ajay Seth said insurance products are expected to go live on the digital platform ‘Bima Sugam’ by the end of September and a consultation paper on delivery reforms will also be released by the end of July.
Speaking at the Insurance Awareness Day 2026 event organized by Insurance Awareness Committee (IAC-Life) in Mumbai, Ajay Seth highlighted these developments and praised the performance of the sector. He said that after the government allowed 100 per cent foreign direct investment (FDI) in the sector, there is a huge increase in interest from foreign promoters willing to acquire 100 per cent stake.
Improving insurance accessibility and delivery
Although the rollout of the Bima Sugam platform is lagging a bit, Seth mentioned that the final integration of the products by the end of September will completely change the distribution landscape. Most importantly, the Insurance Sugam model is not dependent on commission structures, which is a major change from traditional insurance distribution.
To further streamline the sector, the regulator hopes to come out with a consultation paper on distribution reforms before the end of July. Ajay Seth said, “The life insurance sector is at a juncture where it will have to look at, or rather discover, its value proposition.”
Sector grew with the economy
Although general insurance is currently growing faster than life insurance, the regulator believes that life insurance will achieve even higher growth going forward. Macroeconomic expansion serves as a benchmark for this capability.
“In the last 10 years, our country’s economy has grown two and a half times. The top line of the life insurance sector has also grown 2.5 times. One was 2.5, the other 2.6. There is no significant difference,” Seth said. He explained, “This in itself is a commendable task as the economy of our country is growing at a fast pace. But given that income levels are rising and a huge need is still unmet, this sector has the potential to grow much faster than it has so far. And this is where the economics of the sector comes in, how do we improve it?”
Focus on new markets for development
To unlock this growth, the IRDAI chief stressed that companies should go beyond the usual urban limits and focus on Tier-II and Tier-III cities as well as rural markets. The focus has to be expanded across all income group levels to establish a deeper consumer base, which requires an urgent need to increase trust in insurance products.
Additionally, registration trends indicate a wider expansion, with the regulator recently granting two new licenses for general insurance, with the approval of one finalized yesterday. Regulatory authorities are also seeing greater interest in general insurance due to rising income levels and significant consumer needs.
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