CAUSE
One question. One truth.
“Why is insurance penetration low in India?”
High distribution costs, stemming from heavy reliance on intermediary networks, are the primary cause of low insurance penetration in India. The Economic Survey 2025-26 highlights that this inflates premiums and reduces affordability, contributing to customer distrust.
Medium confidenceStructural
CURRENT STATE
India's insurance penetration is approximately 3.7% of GDP, with life insurance at 2.7% and non-life at 1%, significantly below the global average of 7.3%. Only 27% of surveyed individuals hold insurance due to high commissions and overheads.
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