₹1 Lakh Crore Invested by Insurance and NPS in Indian Equities in 2025, Setting Record High

In a landmark development for Indian capital markets, insurance companies and the National Pension System (NPS) have jointly invested over ₹1,00,000 crore in equities so far in 2025. This unprecedented domestic inflow underscores growing confidence and participation by long-term investors despite subdued market returns.

₹1 Lakh Crore Surge in Insurance and Pension Investment

Insurance companies and NPS have cumulatively channelled ₹1,08,129 crore into Indian equities in 2025. Insurance firms have contributed ₹56,821 crore, while NPS has deployed ₹51,308 crore. 

This figure surpasses their combined 2024 investment of ₹36,390 crore, marking a rise of nearly 200%. The increased allocation reflects a strategic shift towards growth-oriented assets amid moderate debt yields and robust economic fundamentals.

Regulatory Reforms Pave the Way

Policy changes have played a key role in enabling this shift. NPS now permits up to 75% equity exposure under Active Choice for investors aged below 50, with gradual tapering for older individuals. 

Tier-II account holders are allowed up to 100% allocation. Similarly, IRDAI has relaxed norms for insurers, allowing increased participation in equities, particularly in BFSI and infrastructure sectors, while still maintaining adherence to prudential limits.

Read More: Mutual Fund Achieves Landmark as Equity Assets Surpass ₹50 Lakh Crore for First Time!

Domestic Institutions Support Equities as FIIs Turn Cautious

Domestic long-term investors have emerged as consistent buyers in 2025 as foreign institutional investors adopt a cautious stance. The shift reflects solid household savings through life insurance and pension avenues and a preference for market-linked instruments such as ULIPs and NPS. Alongside mutual funds, which poured in ₹4,44,000 crore, insurers and pension funds have reinforced equity stability.

Comparative Institutional Activity

While insurance and NPS inflows rose, banks and financial institutions have remained net sellers. Banks sold equities worth ₹16,941 crore and financial institutions offloaded ₹158 crore in 2025. In contrast, total domestic institutional investor contribution stood at ₹6,29,000 crore, up from ₹5,22,000 crore last year, signalling a clear trend of rising domestic involvement.

Conclusion

The record ₹1 lakh crore equity investment by insurance and NPS in 2025 highlights the evolving landscape of India’s capital markets. As regulations evolve and institutions embrace risk-adjusted growth strategies, long-term domestic capital is becoming a crucial pillar for stock market resilience.

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