Cut throat competition between public sector units and private companies may push up general insurance business by over 25 per cent to Rs 15,000 crore (Rs 150 billion) this fiscal, the Insurance Regulatory and Development Authority said on Friday.
"General insurance premium income of all the companies may cross the Rs 15,000 crore mark this fiscal," IRDA member, R C Sharma, said at a seminar organised by Lal Bahadur Shastri Memorial Foundation in New Delhi.
The total premium income of non-life insurers amounted to about Rs 12,000 crore (Rs 120 billion) last fiscal.
Sharma said about 40 per cent of the expected Rs 15,000 crore premium income may come from motor insurance this fiscal despite the tariff regime.
The growth in general insurance sector assumes significance in the wake of entry of private players like Reliance, Tata AIG, Bajaj Allianz, IFFCO Tokio Marine, Royal Sundaram, ICICI Lombard, HDFC Chubb and Cholamandalam.
The private players have in a short span of less than two years acquired 12 per cent market share.
The four public sector units--New India Assurance, National Insurance, Oriental Insurance and United India Insurance--incurred losses on account of motor insurance while losing market share in the fire, engineering, marine and other areas which are out of the tariff regime.
Sharma said private players are expected to double their market share in health insurance sector to 9.0 per cent this fiscal from 4.5 per cent in 2001-02.
Total premium income from health sector is expected to touch Rs 1,200 crore this fiscal compared to Rs 550 crore (Rs 5.5 billion) last fiscal, he said, adding till December, the companies mopped up over Rs 800 crore (Rs 8 billion) in premium.