New Delhi, Oct 30 India has a sizeable insurtech ecosystem with over 150 active players, whose cumulative valuations crossed $15.8 billion, and revenues surpassed $0.9 billion in 2024 -- a 10 times increase since 2019, a report said on Thursday.
The sector has two unicorns, eight players between $100 million $1 billion and more than 45 players over $1 million mark. Despite a slowdown in insurtech funding in 2024, Health insurtechs in India accounted for four of the five largest deals and more than 70 per cent of the funding, reflecting their role in driving access, efficiency, and innovation.
In the year, global Insurtech funding slowed down to $4.1 billion, in line with the wider fintech correction.
"Regional dynamics have shifted, with Europe, the Middle East and Africa (EMEA) gaining share as Asia-Pacific (APAC) declined. India also mirrored the global trends, signalling a shift in investor focus to backing businesses with clear paths to profitability and scale," India InsurTech Association (IIA) said in its joint report with Boston Consulting Group (BCG).
However, the next chapter will be defined not by growth at any cost but by sustainable, profitable operating models, it added.
GenAI has the potential to fundamentally transform the value chain, from distribution to claims and from marketing to servicing, by improving efficiency, accuracy, and customer experience.
According to the report, the opportunity now is to move decisively beyond pilots and embed adoption at scale.
“AI and GenAI offer a $4 billion profit opportunity for India’s insurance industry. There are three key imperatives for organizations to achieve this value - focus on 2-3 high value pools rather than let a thousand flowers bloom; investing in high-quality data; and balancing traditional and generative, models to manage costs and maximize value," said Pallavi Malani, Managing Director and Partner, Lead-India Insurance Practice at BCG, and co-author of the report.
Where implemented effectively, AI and GenAI have already delivered 10–20 per cent efficiency gains in underwriting, 20-40 per cent lower service costs, and 3–7 per cent improvement in claims payout, she added.
As per the report, GenAI has emerged as the next major force shaping the insurance industry. The technology has evolved from AI to GenAI and now Agentic AI, with insurance ranking second globally in adoption, behind only technology.
Use cases span the entire operating model -- sales and distribution, underwriting, claims, renewals, and servicing.
Large insurers deploying GenAI are already seeing significant impact, with 15–20 per cent productivity increase for agents, 10–20 per cent efficiency gains in underwriting, 20–30 per cent lower service costs, and 3-7 per cent increase in claims payout efficiency.
Insurtechs are central to this transformation, co-innovating with insurers and productizing AI modules for distribution, underwriting, claims, servicing, and renewals.
“Global insurtech funding dropped from nearly $14 billion in 2021 to about $4 billion in 2024, in line with the wider fintech correction. India too has mirrored the global funding trends,” said Vivek Mandhata, Managing Director and Partner at BCG, and co-author of the report.
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