About 70 per cent Indians own a life insurance policy, but only about a quarter have a pure life term plan, shows a joint study by Max Life Insurance and Kantar IMRB. Even among the 28 per cent owners of term plans, almost 55 per cent reported an insufficient cover.
However, the silver lining is that awareness around term insurance plans is higher at 57 per cent. “Increased awareness is followed by action, which means we can expect more individuals to buy term plans in the coming years,” said Prashant Tripathy, Managing Director and CEO, Max Life Insurance, during the event.
Delhi lead the way even in life insurance awareness (67) but fell behind Mumbai, Bhubaneshwar and Kolkata in ownership. Surprisingly, Bengaluru and Pune, which comprise of highest young working population, fell behind not only in life insurance awareness and ownership but also in IPQ.
In fact, 57 per cent respondents from tier 2 cities reported that their savings will exhaust within 1 year in case of bread winner’s death. In comparison, 39 per cent respondents from metro cities feel the same.
Indians prefer savings over protection, says the survey. Perhaps for this reason, almost 68 per cent respondents reported return on premium as the most important benefit they would like in their term plan. It is no surprise then compared to term plan and market linked products (ULIPS), endowment products have maximum takers across the country.
In terms of age demographic, millennials and non-millennials are equally aware of life insurance products, however ownership is high among non-millennials by 7 per cent. The reason for this could be that a fair share of millennial population (born between 1982 and 1996) is below 30 years and do not have financial dependents.
