Economic Survey 2026: The country's social security is stronger! Historic increase in pension and insurance coverage
In recent years, there has been significant progress in the field of social security with substantial growth in pension and insurance coverage in the country. This information was revealed in the economic survey presented by Finance Minister Nirmala Sitharaman in Parliament on Thursday. The survey noted that the Insurance Regulatory and Development Authority of India (IRDAI) and the Pension Fund Regulatory and Development Authority (PFRDA) have implemented important reforms to strengthen financial inclusion and provide social security to the underprivileged.
PFRDA has laid the foundation for a robust and inclusive pension system, which includes the market-linked National Pension System (NPS), the Unified Pension Scheme (UPS) launched in 2025, the Employees' Provident Fund (EPF), and the Atal Pension Yojana (APY). As of December 31, 2025, NPS has 21.17 million subscribers and assets under management (AUM) have reached 16.1 trillion rupees. Between the financial years 2015 to 2025, NPS subscribers grew at a compound annual growth rate (CAGR) of 9.5%, and AUM increased by 37.3%. Similarly, the number of subscribers in APY, launched in 2016, grew at a CAGR of 43.7%, while AUM recorded a massive growth of 64.5%.
The insurance sector is also rapidly moving towards the goal of 'Insurance for All by 2047'. IRDAI has adopted a principles-based regulatory framework, providing flexibility for innovation by reducing the compliance burden on companies. The life insurance segment has dominated, accounting for 91% of total AUM and 75% of premium income. In the financial year 2025, life insurance companies collected premiums amounting to 6.3 lakh crore rupees.
Structural changes have occurred in the essential insurance sector, and health insurance has now become the largest segment. It accounts for 41% of the total domestic premium, surpassing motor insurance. During the financial year 2021 to 2025, the net expenditure in the essential insurance sector increased by more than 70% to 1.9 lakh crore, with health and motor insurance playing a major role.
The GST concessions on life insurance and personal health insurance policies have provided significant relief to policyholders, making insurance services more affordable. With the implementation of the 'Insurance for All, Security for All Act, 2025' and reforms such as increasing the limit of foreign direct investment to 100 percent, the expansion of the insurance sector will gain momentum and ease of doing business will improve, as noted in the economic survey. This progress will be reassuring for the financial security of ordinary citizens.