Authored by Mr. Naveen Chandra Jha, MD & CEO, SBI General Insurance
Insurance in India has entered a structurally transformative phase, with its role in economic and social resilience. Earlier, insurance purchases were largely driven by specific life events and the primary goal of providing financial protection to survivors after death. The modern insurance landscape has evolved significantly from these origins.
Today, the context is much broader. Rising medical inflation, increasing climate-related disruptions, and the growing threat of digital fraud have heightened the financial vulnerability of everyday risks. Together, these forces are redefining the role of insurance in household financial planning. As the industry approaches 2026, this shift will be a defining influence on consumer choices and product architecture.
A year that reset direction
Policy developments in 2025 further supported growth and inclusiveness in insurance. The non-life insurance business crossed ₹3 trillion in gross direct premiums written during the year 2024-25, recording growth of about 6.2% y-o-y, reflecting solid advances made in market participation.
In September 2025, the government removed GST on premiums for individual life and health insurance from 18% to zero. For households, this reduced the policy cost and made protection more accessible. More importantly, it reinforced the place of insurance as an essential financial product rather than a discretionary expense.
Meanwhile, digital adoption continued to shape expectations. With UPI, Aadhaar-linked services, and platform-based transactions becoming essential in everyday life, there is an expectation for clarity, guidance, and timely engagement at all touchpoints in the insurance journey for policyholders.
Experience is the differentiator
While pricing remains relevant, it is no longer the sole factor influencing insurance decisions. Consumers are increasingly evaluating insurers based on ease of onboarding, responsiveness during claims, and the clarity of policy communication.
A predictable and transparent experience often carries greater weight than marginal differences in premium. The regulatory direction has also aided this trend through the wider use of digital KYC, integration with the Account Aggregator framework, and greater use of technology for claims processing and grievance redressal.
Regulatory and Policy Momentum
The list of regulatory priorities has grown with the evolving risk landscape. IRDAI guidelines on the Insurance Fraud Monitoring Framework, notified in 2025 and effective from April 1,
2026, aim at augmenting deterrence, detection, and reporting against fraud risks for both insurers and distribution channels.
Climate-related disruptions are also getting increasingly frequent and localised, affecting households, vehicles, and livelihoods within communities. This has resulted in a growing interest in solutions that can provide quick financial relief in response, including parametric insurance models that can assure faster pay-outs upon predefined events.
Digital risks have emerged as a significant and unavoidable concern in today’s increasingly connected environment. Online fraud has become more sophisticated and impacts individuals through everyday transactions. As digital adoption deepens, personal cyber insurance is likely to inch closer to the mainstream in 2026. Coverage against phishing, unauthorised digital payments, identity theft, data breaches, and online harassment reflects the realities of a digital-first economy.
2026: Predictive, Personalised and Inclusive Insurance
By 2026, insurance will be more modular, predictive, and inclusive. Products will start to allow customers to select their coverage according to life stage, location, and usage. Behaviour-linked motor premiums, wearable-enabled health plans, and tailored solutions for small businesses are expected to become increasingly prevalent. More and more, health reminders, driving-risk alerts, climate advisories, and even cyber safety guidance will complement financial protection by reducing the likelihood and consequences of loss.
Further integration could be anticipated in telemedicine, preventive health assessments, wellness programmes, chronic condition monitoring, and mental health services. This is consistent with the stepwise shift from paying to treat illness to paying to promote wellbeing, which is increasingly rooted in lifestyle-related conditions among all age groups.
Meanwhile, convenience and consistency will continue to be defined by omni-channel engagement across branches, apps, and call centres. At its core, the transformation underway concerns purpose. As the industry looks beyond 2026, insurance will be defined not only by its response to events but also by its role in underpinning financial resilience. This shift from protection to prevention will shape how consumers engage with insurance in the years ahead.
