Group Life Insurance Market Expected to Reach $348.4 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Group Life Insurance Market, By Type (Contributory Plans and Non-contributory Plans), By Enterprise Size (Large Enterprises and Small and Medium-sized Enterprises), By Distribution Channel (Direct Sales, Brokers/Agents, Banks, and Others): Global Opportunity Analysis and Industry Forecast, 2022-2032". The group life insurance market was valued at $127.59 billion in 2022, and is estimated to reach $348.4 billion by 2032, growing at a CAGR of 10.7% from 2023 to 2032.

An insurance policy covering the lives of members of recognized groups is known as group life insurance. A single policy is issued which covers all the members who are a part of the group that is being insured. Usually, term insurance plans are offered as group life insurance plans, and group insurance plans are also called group term plans.

Businesses offer group life insurance to help attract and retain talent. For businesses, offering group life insurance can be an effective way to show employees that they are valued and that their well-being is a priority. Companies can secure costs for each employee that are much lower than if they were to purchase an individual policy by purchasing group life insurance policy coverage through an insurance provider on a wholesale basis for its members.

The group life insurance industry is being fueled by a rise in understanding of the value of both employee and financial security, which is leading to a growth in the acceptance of these policies among businesses. The growth of the group life insurance market is also aided by tax benefits and legal support for companies that provide group life insurance.  In addition, market expansion is impeded by economic uncertainty, which may lead certain companies to cut expenses and, consequently, insurance coverage. But changes in interest rates can also impact group life insurance product rates and benefits, as well as profits on investments of insurers. Moreover, market players face challenges related to regulatory changes and compliance. On the contrary, the group life insurance market is expected to exhibit significant growth potential due to technological advancements that streamline insurance operations and provide opportunities for product innovation that cater to a wide range of consumer needs. The ongoing digital transformation of insurance industry has created new avenues for the group life insurance market growth by providing a platform for enhanced customer engagement and operational efficiency. Hence, the technological advancements in the insurance industry will provide growth opportunities to the group life insurance market trends in the upcoming years. 

On the basis of enterprise size, the large enterprises segment acquired a major share in 2022. The growth of group life insurance in large enterprises is fueled by the fact that it provides employees with financial security, enhancing overall job satisfaction and retention. However, the small and medium-sized enterprises segment is the fastest-growing segment during the forecast period. The rise in popularity of this policy contributes to market growth as SMEs recognize the awareness of group life insurance. For instance, in May 2023, Max Life Insurance Company (Max Life), a private life insurer, formed a partnership with the Indian Industries Association (IIA) to provide life insurance plans to the workforce of MSME sector in Uttar Pradesh (UP). Under the State Insurance Plan of IRDAI, Max Life aims to enhance accessibility and drive affordable insurance penetration across UP.

On the basis of region, North America dominated the group life insurance market in 2022, owing to the increase in awareness and importance of financial security and the ease of access to coverage within the workplace contributes to its popularity. However, Asia-Pacific is considered to be the fastest-growing region during the forecast period. This is attributed to the convenience of group policies, with simplified underwriting processes and cost-sharing benefits, attracting employers seeking to provide coverage for their workforce.

The COVID-19 pandemic had a positive impact on the group life insurance market size. The pandemic highlighted the importance of financial planning, stability, and protection for employees. As a result, there has been a surge in demand for group life insurance policies, particularly term insurance plans, which offer a high amount of coverage at an affordable price. According to IRDAI data, the number of life insurance policies sold, and the total amount of premiums collected have registered a year-on-year (y-o-y) increase in June 2022, compared to the same month in the previous year.     

Key Findings of the Study

• On the basis of type, the non-contributory plans segment accounted for the highest group life insurance market share, in terms of revenue in 2022.
• On the basis of enterprise size, the large enterprises segment attained the highest market share in 2022.
• On the basis of distribution channel, the banks segment is expected to be the fastest growing segment during the forecast period.
• On the basis of region, North America generated the highest revenue in 2022. 

The key players operating in the group life insurance market analysis include MetLife Services and Solutions, LLC, American International Group, Inc., Prudential Financial, Inc., Allianz, AXA SA, Zurich, The Manufacturers Life Insurance Company, Sun Life Assurance Company of Canada, Cigna Healthcare, and New York Life Insurance Company.  These players have adopted various strategies to increase their market penetration and strengthen their position in the group life insurance industry.