Insurance industry is poised to double its business with premium income expected to be 3 per cent of gross domestic product in 4-5 years compared to 1.6 per cent now, the Insurance Regulatory and Development Authority said on Wednesday.
"Doubling of insurance premium income is not impossible in 4-5 years. We could at least aim at a level of 3 per cent of GDP," IRDA chairman, N Rangachary, said at a FICCI seminar in New Delhi.
At present, he said the proportion of insurance premium to GDP was 1.6 per cent, which is quite low compared to an average 6-6.5 per cent in developed nations.
Although the total premia collected by general insurance companies in developed nations were much higher than life insurance premium, Rangachary said the trend was opposite in this country.
Non-life premium in the country would go up significantly with growth in economy, especially the industrial sector.
According to a joint study of Life Insurance Corporation and KPMG, the growth in insurance premium in India has been 8.2 per cent in recent times compared to 3-4 per cent worldwide.
Another estimate by global reinsurance major Swiss Re reveals that India's life insurance industry is set to grow by 14 per cent during 2001-05.
The Indian life and general insurance sector mopped up about Rs 40,000 crore (Rs 400 billion) in first premium income last fiscal, while the gross domestic product of the country stood at about Rs 25,00,000 crore (Rs 2500 billion).