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Life Insurance Penetration Declines Across Key Indian States; West Bengal Still Leads
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Moneycontrol•30-09-2026, 12:20
Life Insurance Penetration Declines Across Key Indian States; West Bengal Still Leads
- •Life insurance penetration has fallen across several leading Indian states from FY2021 to FY2025, indicating that premium growth lagged behind state economic expansion.
- •The Insurance Information Bureau of India's (IIB) analysis shows a decline in penetration across all eight tracked states with high penetration levels.
- •Assam experienced the sharpest drop, with life insurance penetration falling from 3.52% in FY21 to 2.49% in FY25.
- •West Bengal maintained the highest penetration among the highlighted states in FY25 at 3.11%, despite a decrease from its FY21 level of 3.65%.
- •The decline in penetration signifies that annual premiums did not grow as fast as the Gross State Domestic Product (GSDP), not necessarily that premiums themselves decreased.
Key Questions Answered
West Bengal retained the highest life insurance penetration among the highlighted states in FY25 at 3.11 percent, although this was a decrease from its 3.65 percent level in FY21.
Life insurance penetration declined across every state tracked by the Insurance Information Bureau of India between FY21 and FY25. Assam recorded the sharpest drop with a 1.04 percentage point decrease, while states like Odisha, Maharashtra, and West Bengal also saw notable reductions.
Haryana recorded the highest average sum assured at about Rs 8.83 lakh per policy in FY25, followed closely by Delhi at Rs 8.77 lakh and Mizoram at Rs 7.77 lakh.
