New Delhi [India], July 17 (ANI): The insurance industry in India is witnessing a slowdown, mainly due to the moderation in auto sales and a drop in corporate policy renewals, according to a recent research report by Nuvama.

The report stated that the industry growth is expected to remain weak, largely driven by a slowdown in motor sales and lower corporate policy renewals. However, the impact of muted auto sales may be partially balanced by the recent hike in third-party (TP) premiums.

The report also noted that large incumbent insurers may benefit from the stricter implementation of Expenses of Management (EoM) regulations imposed by the Insurance Regulatory Development Authority (IRDAI).

It stated, 'We expect slower industry growth largely due to a slowdown in motor sales...... Retail health expanded 9.8 per cent YoY while group remained flat at -0.1 per cent YoY dragged by lower corporate policy renewals.'

The report also pointed out that the growth in retail policies was impacted due to the one-nth (1/n) recognition of long-term health policies, which affected the reported growth figures.

Motor insurance growth has slowed down due to weak retail motor sales. The Gross Direct Premium Income (GDPI) in the motor segment rose by 6.7 per cent YoY in June 2025, compared to 8.2 per cent YoY growth in May 2024.

Within this segment, third-party (TP) insurance grew by 8.1 per cent YoY, while own damage (OD) insurance saw a moderate increase of 4.7 per cent YoY.

The report also highlighted that public sector general insurers continued to gain market share aggressively, reaching 29.4 per cent in Q1 FY26, a rise of 222 basis points compared to the previous year.

Their growth in the OD and TP segments was reported at 4.7 per cent and 18.8 per cent YoY, respectively, for June 2025.

Overall, the industry's GDPI growth remained sluggish in June 2025. While fire insurance showed a strong pickup with a 20.6 per cent YoY growth, health insurance growth moderated to 3.3 per cent YoY.

Excluding crop insurance, the GDPI grew by 9.3 per cent YoY. In the motor segment, OD and TP premiums grew by 4.7 per cent and 8.1 per cent YoY, respectively.

The slower growth in the insurance sector was mainly due to slowdown in motor sales and lower corporate policy renewals, though some segments like fire insurance and TP motor insurance showed positive momentum. (ANI)