AUM of Life Insurance Funds

• The Indian life insurance industry has demonstrated remarkable growth and resilience over the last decade, as evident from the expansion of Assets Under Management (AUM) across multiple segments.

• Between 2015 and 2024, the AUM of life insurance funds grew consistently, rising from INR 14,95,309.14 crore in March 2015 to an impressive INR 39,21,782.92 crore in March 2024. This nearly three-fold increase underscores the sustained trust of policyholders in long-term savings and protection instruments.

• Pension and general annuity funds, which form the backbone of retirement security in India, also showed robust growth, climbing from INR 3,89,472.57 crore in 2015 to INR 14,74,349.21 crore in 2024. The Unit Linked Insurance Plan (ULIP) segment, though more volatile due to its market-linked nature, has also seen substantial growth. This indicates renewed consumer confidence in hybrid products that combine insurance protection with wealth creation.

• The period from 2020 onwards highlights accelerated growth in AUM across all categories, driven largely by pandemic-induced risk awareness, rising digital adoption, and a preference for guaranteed and market-linked products.

• From 2021 to 2024, life insurance fund AUM alone expanded by over INR 10 lakh crore, showcasing the industry’s pivotal role in channeling household savings into long-term financial instruments. The pension and annuity segment too benefited from a rising middle class focused on securing post-retirement income, with its AUM increasing by nearly 42% between 2021 and 2024.

• ULIPs, once seen as risky by conservative investors, gained fresh traction during this period, reflecting both improving investor education and favorable equity market performance. A closer look at the trajectory also reveals that insurance as an investment and protection tool is steadily becoming a mainstream financial planning choice in India.

• The massive growth in AUM suggests not only rising policy sales but also improved persistency, meaning that customers are continuing their premium contributions over the long term. This strengthens the financial stability of insurers, enabling them to invest further in infrastructure, technology, and customer service. From a competitive perspective, private insurers have increasingly gained traction in the ULIP and pension segments, while the Life Insurance Corporation of India (LIC) continues to dominate the traditional life insurance fund space.

• Overall, the data from 2015 to 2024 paints a clear picture of sustained growth and maturity in India’s insurance industry, with life insurance funds, pension and annuity funds, and ULIPs all contributing to the expanding financial landscape.