India’s insurance ecosystem is undergoing a dramatic transformation, with the reinsurance segment poised to become the catalyst for deeper, broader risk coverage. As the primary insurance market in India experiences unprecedented growth, the supporting reinsurance framework has yet to fully catch up. This gap presents a significant opportunity for innovation, digitization, and structural reform—according to Tarun Mathur, Co-founder and Chief Business Officer at Policybazaar for Business.
Bridging the Reinsurance Gap in India’s Expanding Insurance Sector
Since its founding in 2008, Policybazaar has grown into a dominant force in India’s insurance and reinsurance broking space. With over 42 million policies sold and a 90% share of the digital distribution market, the company has unique insights into market inefficiencies and consumer needs.
Mathur highlights a major concern: while the insurance market is scaling rapidly, reinsurance in India remains underdeveloped. This imbalance, however, is more than just a challenge—it’s an invitation for reinvention. As businesses digitize and become more risk-conscious, the demand for reinsurance-backed solutions is accelerating across sectors such as healthcare, logistics, IT, and infrastructure.
Driving Risk Expansion Through Data-Backed Reinsurance Models
Policybazaar’s strategy extends beyond insurance distribution. One of its primary goals is to push the boundaries of reinsurance adoption across emerging and underpenetrated risk classes. Mathur identifies cyber insurance, professional indemnity (PI), parametric insurance, and liability coverage as areas where reinsurance can bring real value.
For example, construction and manufacturing firms frequently face long-tail liabilities. Reinsurance enables insurers to underwrite such risks more confidently and sustainably. With access to extensive data on claims, risk usage, and emerging patterns, Policybazaar facilitates more intelligent underwriting and pricing models.
“Reinsurers are increasingly leveraging analytics to price smarter and manage risk more effectively—even in sectors historically deemed too volatile or complex,” says Mathur.
Reinsurance-as-a-Service (RaaS): Tailoring Solutions for India’s Scale
A major milestone for Policybazaar for Business was the regulatory green light from the Insurance Regulatory and Development Authority of India (IRDAI) to enter the reinsurance domain. In response, the company launched its proprietary Reinsurance-as-a-Service (RaaS) platform.
Designed for the unique demands of India’s vast and varied economy, the RaaS model emphasizes modularity, ease of use, and plug-and-play functionality. By simplifying workflows and minimizing manual dependencies, it brings much-needed efficiency and speed to reinsurance transactions.
“Historically, reinsurance in India involved too much clerical effort. We’re automating those touchpoints—quote management, data aggregation, and information exchange—to make it more analytical and transparent,” explains Mathur.
Collaborative Reinsurance Product Development with Global and Local Partners
Another cornerstone of Policybazaar’s reinsurance strategy is product co-creation. By partnering with both Indian and international reinsurers, the company helps localize and customize reinsurance offerings for Indian corporates.
With visibility into the entire insurance lifecycle—from initial inquiry to claims servicing—Policybazaar provides reinsurers with critical insights into local trends, risk appetite, and customer behavior. This enables the development of fit-for-purpose reinsurance products that resonate with the Indian business environment.
“Our edge lies in the granularity of our data. We understand what Indian enterprises need, and we help reinsurers adapt their offerings accordingly,” Mathur notes.
Regulatory Support Fuels India’s Reinsurance Evolution
India’s regulatory environment has become a key enabler of reinsurance innovation. Recent IRDAI reforms have made it easier for Foreign Reinsurer Branches (FRBs) to operate in India by reducing capital requirements and simplifying program norms. Moreover, the alignment with the International Financial Services Centers Authority (IFSCA) supports international participation.
One notable example is GIFT City—a financial hub offering attractive incentives and infrastructure for reinsurance firms. Combined with faster approval cycles and tech-friendly sandbox initiatives, the regulatory direction is now actively supporting market modernization.
“This regulatory shift is essential if India aims to become a global reinsurance hub,” says Mathur. “And we’re moving in the right direction.”
April 2025 Reinsurance Renewals Reveal Strategic Shifts
The April 2025 renewal cycle underscored a shift in India’s reinsurance priorities. According to Mathur, there was a marked departure from catastrophe-centric coverage to broader risk portfolios, including cyber incidents, commercial health liabilities, and professional risks.
More insurers are adopting structured, layered reinsurance programs that offer flexible protection across multiple risk scenarios. Another notable trend was the preference for reinsurers with strong digital infrastructure and deep market knowledge—two traits that offer a clear competitive edge.
“Reinsurers that brought advanced tech tools and local intelligence were top of mind during the renewals,” Mathur reflects. “Customization and agility were the name of the game.”
A Forward Path: Specialized, Digital-First Reinsurance in India
Looking ahead, Mathur sees India’s reinsurance market evolving into a more specialized, digitally integrated ecosystem over the next 12 to 24 months. He envisions a landscape where modular product designs and data-informed strategies dominate, providing flexible solutions to both startups and large corporations.
“Startups require lean, adaptable products, while bigger firms need comprehensive coverage. Reinsurance empowers both ends of the spectrum with capacity, structure, and pricing flexibility,” he explains.
He also anticipates greater collaboration between brokers, insurers, and reinsurers to drive innovation and sustainability. The focus will shift to shared intelligence, faster execution, and co-developed risk strategies.
Conclusion: A Reinsurance Renaissance in India
India’s reinsurance sector stands on the brink of a transformative era. With rapid digitization, regulatory momentum, and increasing demand for diversified risk solutions, the market is primed for a reinsurance revolution. Companies like Policybazaar for Business are leading the charge—leveraging technology, market intelligence, and collaboration to bridge existing gaps and create a smarter, more resilient insurance ecosystem.
As the country continues to evolve economically and digitally, reinsurance will be essential in building the next generation of risk management solutions in India.
