Mumbai, June 2025: Probus, one of India’s leading InsurTech and insurance broking firms, has released a new report highlighting a major shift in the country’s insurance landscape. The findings reveal that Tier-III cities and beyond now contribute nearly 62% of total new insurance business in the current fiscal year, signalling a dramatic decentralisation of India’s insurance growth story.
Once considered peripheral markets, smaller towns are rapidly emerging as the real growth engines of Digital Bharat, a transformation propelled by the success of UPI, expanding digital payment infrastructure, and deepening internet penetration. Most UPI transactions now originate from non-metro regions, indicating a high level of digital adoption and financial participation.
Probus notes that this is not a temporary or seasonal trend, but a consistent pattern of growth observed over the past three consecutive fiscal years – rising from 58% to 62%, reflecting a sustained upward momentum. In FY 2024-25 alone, the Motor Insurance segment registered the highest growth at 25.6%, fuelled by rising awareness, digital accessibility, and a strengthened PoSP (Point-of-Sale Person) network.
Local distribution models, especially those built on app-based onboarding, regional language interfaces, and education-first selling, have played a key role in bringing insurance products closer to underserved consumers. What was once a passive, compliance-driven purchase is now increasingly seen as a proactive financial planning tool in Tier-III cities and beyond.
The report also highlights strong momentum across insurance verticals for FY 2024-25 compared to FY 2023-24, with life insurance premiums growing by over 60% in fresh policies. Non-life insurance premiums, led by motor, health, and SME segments, showed significant growth, with SME insurance emerging as the fastest-growing segment in FY 2024-25, registering a 112% increase.
Commenting on the findings, Mr. Rakesh Goyal, Director, Probus, said, “At a global level, the Indian economy has shown remarkable resilience despite external headwinds. A key reason behind this strength is the steady rise of Tier-II and Tier-III cities, and our latest data confirms that. At Probus, we are proud to be aligned with the Government of India’s vision of ‘Insuring India by 2047. We’ve built digital tools and strengthened our PoSP models to deliver seamless, contextual insurance solutions to the emerging consumer in India.”
The company’s robust PoSP network continues to be the vital bridge connecting underserved markets to comprehensive insurance solutions, driving Probus’s mission to empower every corner of India with financial security.