India InsurTech Association (IIA) in collaboration with the Boston Consulting Group (BCG) has released the fifth edition of the India Insurtech report “India Insurtech Landscape and Trends: Reimagining insurance with AI” at the India Insurtech Association Annual Event 2025. The report provides an overview of the global and Indian Insurtech landscape, evaluates the critical role of India’s insurance sector in achieving Viksit Bharat ambitions, and identifies AI and GenAI as key accelerators of a multi-billion-dollar opportunity. It further outlines how these technologies can reimagine the insurance value chain end-to-end and emphasizes the imperative to move from pilots to scale for sustainable, industry-wide impact.

Funding and ecosystem Maturity

India has a sizeable Insurtech ecosystem, with 150+ active players, cumulative valuations crossing USD 15.8 billion, and revenues reaching USD 0.9 billion in 2024 - a 10x increase since 2019. The sector has 2 unicorns, 8 players between USD 100 million to USD 1 billion and 45+ players over USD 1 million. Global Insurtech funding slowed down to USD 4.1 billion in 2024, in-line with the wider Fintech correction. Regional dynamics have shifted, with EMEA gaining share as APAC declined. India also mirrored the global trends, signaling a shift in investor focus to backing businesses with clear paths to profitability and scale. Health Insurtechs in India accounted for 4 of the 5 largest deals and more than 70% of the funding, reflecting their role in driving access, efficiency, and innovation.

However, the next chapter will be defined not by growth at any cost but by sustainable, profitable operating models. 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. The opportunity now is to move decisively beyond pilots and embed adoption at scale.

“AI and GenAI offers a USD 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 & generative, models to manage costs and maximize value. Where implemented effectively, AI and GenAI have already delivered 10–20% efficiency gains in underwriting, 20-40% lower service costs, and 3–7% improvement in claims payout.”, said Pallavi Malani, Managing Director and Partner, Lead - India Insurance Practice at BCG, and Co-author of the report.

“India's insurance industry is poised for an unprecedented transformation. The integration of AI and GenAI presents a massive opportunity, projected to unlock over $25 billion in new revenue. Seizing this potential requires visionary collaboration and decisive industry-wide action. The IIA is perfectly positioned to serve as the central platform, fostering an ecosystem where innovation and execution converge to help build the future of insurance in India.”, said Subhajit Mandal, Co-Founder, India Insurtech Association, and Co-author of the report.

“Organizations that have scaled AI/GenAI have done it in months, not years - by moving quickly from pilots to implementation. Scaling AI and GenAI successfully requires a focused, end-to-end approach: prioritizing 2–3 high-value pools instead of a ‘thousand-flowers-bloom’ approach, balancing technology with talent to embed transformation across teams, leveraging Insurtech partnerships to accelerate implementation, and establishing clear governance and Responsible AI principles to enable scalable, ethical adoption. Together, these enable insurers to move from experimentation to impact - translating proven pilots into enterprise-scale outcomes.”, said Pranay Mehrotra, Managing Director & Senior Partner, Lead – APAC Insurance Practice at BCG, and Co-author of the report.

AI/GenAI – The next Frontier

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 #2 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% productivity increase for agents, 10–20% efficiency gains in underwriting, 20–30% lower service costs, and 3-7% 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 USD 14 billion in 2021 to about USD 4 billion in 2024, in line with the wider fintech correction. India too, has mirrored the global funding trends. It reflects a shift in investor focus to backing businesses with clear paths to profitability and scale. This phase will separate experimentation from execution, as Insurtechs partner with insurers to build sustainable, high-impact models for the long term.”, said Vivek Mandhata, Managing Director and Partner at BCG, and Co-author of the report.

AI as the catalyst for India’s Insurance transformation

India’s insurance industry stands at a pivotal juncture - an essential pillar in achieving Viksit Bharat aspirations of inclusive financial protection and sustainable growth. The sector has expanded steadily, but growth momentum and profitability have both slowed down in recent years. Premium growth has been at 7% CAGR, while return on equity has reduced as margins remain under pressure. To enable India’s transition to a developed economy by 2047, the industry will need to accelerate to 13–15% annual premium growth over the long term, supported by stronger productivity, innovation, and financial inclusion.

AI/GenAI has emerged as a catalyst for India’s Insurance industry, presenting a USD 4 billion annual profit expansion opportunity - a 60% increase on a USD 6 billion profit base, driven by USD 25 billion in additional revenue and USD 3 billion in cost savings. AI/GenAI is redefining how insurers sell, underwrite, service, and retain customers - creating a more intelligent, inclusive, and efficient ecosystem. Across the value chain, use cases are rapidly maturing:

• Sales & Distribution: Personalized advisory and productivity enhancement through AI co-pilots
• Underwriting: Automated risk evaluation, consistent decisioning, and faster case turnaround
• Claims Management: Transparent adjudication, automated validation, and proactive FWA detection
• Customer Servicing: Real-time assistance, contextual resolution, and seamless customer experience
• Renewals: Hyper-personalization, autonomous voice/chat engagement and real-time call assistance
• Marketing & Customer Growth: “Segment of One” cross-sell and up-sell through personalized offers and multi-channel campaigns

Building a scalable model critical to drive value from AI/GenAI

90%+ insurers globally have launched AI/GenAI pilots; however, only 7% have scaled to enterprise-wide adoption. Scaling AI/GenAI capabilities and driving value requires a focused, end-to-end approach:

• Prioritize 2-3 high value pools to transform, instead of a "thousand flowers bloom” approach
• Balance technology with talent: 30% value is derived from AI/GenAI technology, 70% is derived through organizational capabilities and transformation
• Re-imagine processes, people and policy end-to-end for measurable outcomes, vs building point solutions
• Invest in data quality and build intelligence layers to unlock the full potential of AI/GenAI
• Mix of traditional AI + Gen AI is critical to manage costs and derive value
• Roll-out minimum viable products in 100-day waves and leverage insurtech partnerships to mitigate implementation risks

India has a strong foundation to scale responsibly, supported by 34,000+ GPUs (30 - 40% cheaper than global averages), 1,000+ curated datasets through AIKosh, and Indic-first multilingual models that enable inclusive scaling. Realizing the full potential will demand collaboration across the ecosystem: Insurers must move from pilots to scaled adoption, Insurtechs must productize and integrate solutions, and regulators must strengthen sandboxes, governance, and Responsible AI frameworks.

“India’s insurance industry can be fundamentally reimagined with AI and GenAI, with multiple use cases transforming the entire value chain, from distribution and underwriting to claims, renewals, and customer engagement. India’s digital and AI infrastructure provides a unique foundation to leapfrog from driving financial inclusion at home to shaping innovation globally. The onus now lies on the entire ecosystem - insurers, insurtechs, and regulators, to come together and chart the path for the future, positioning India as a global benchmark for how to scale AI responsibly and inclusively.”, said Suhail Bhansali, Partner at BCG, and Co-author of the report.