Nomura has initiated coverage on India's non-life insurance sector with a bullish stance on health insurers, assigning 'Buy' ratings to Star Health and Allied Insurance Company and Niva Bupa Health Insurance Company.
The brokerage has set a target price of ₹675 for Star Health and ₹105 for Niva Bupa. It also initiated coverage on PB Fintech with a 'Neutral' rating and a target price of ₹1,590, while ICICI Lombard General Insurance Company received a 'Neutral' rating with a target price of ₹1,820.
According to Nomura, India's non-life insurance industry has delivered a compound annual growth rate (CAGR) of 13% in gross written premiums between FY16 and FY26, with the market expanding to ₹3.35 lakh crore in FY26.
Health insurance has emerged as the fastest-growing segment, accounting for 41% of the industry's premium mix in FY26 and registering a 19% CAGR over the past decade. Motor insurance, which contributes 32% of total premiums, recorded a 10% CAGR during the same period, while the commercial insurance segment grew at a CAGR of 12%.
The brokerage said that each segment operates within a distinct ecosystem.
The health insurance business relies on a network of distributors, hospitals and third-party administrators, whereas the motor insurance segment is closely linked to vehicle dealers, repair networks and the judicial system.
Nomura also mentioned the critical role played by insurance distributors across the sector. It estimated the industry's commission pool, covering both life and non-life insurance, stood at ₹1.08 lakh crore in FY25, showing a CAGR of 17% between FY16 and FY25.