Prashant Tripathy, managing director and CEO, Max Life Insurance
India has begun recognizing the real value of term insurance, ownership remains an area of challenge that the life insurance industry will need to work hard to address
New Delhi:
A survey, by Max Life Insurance showed that the degree to which urban Indians are aware about life insurance products has moved up in the post pandemic period.
As per the latest edition of the survey(India Protection Quotient(IPQ) 5.0),urban India showcased a positive movement, climbing up 8 points on the Protection Quotient to 43 from IPQ 1.0 – signaling steady progress in the country’s overall financial protection levels.
The survey conducted in partnership with Kantar Insights, also revealed that the degree to which urban Indians are aware about life insurance products or the Knowledge Index moved up from 39 (in IPQ 1.0) in 2019 to 57 and life insurance ownership levels increased by 800 bps from 2019 (IPQ 1.0) to 73%.
Prashant Tripathy, managing director and CEO, Max Life Insurance said beginning with a Protection Quotient of 35 in 2019, India has come a long way.
“This year, we see urban India transition to a more secure space, as health anxieties take a backseat,”he said.
Against the backdrop of a waning pandemic, the survey highlights a massive recovery in security Levels.
It is observed to be steadily coming back to pre-pandemic levels- starting from 66% in IPQ 1.0 to an all-time–low of 57% during the pandemic, and back to 63% in this edition.
According to IPQ 5.0, with respite from health-related worries, urban India has begun reprioritising investments in savings plans for life insurance showcasing sustained growth in ownership – up from 24% in IPQ 1.0. to 38% in IPQ 5.0, while term plan 1 adoption rates have grown 50% in five years.
Additionally, while India has begun recognizing the real value of term insurance, ownership remains an area of challenge that the life insurance industry will need to work hard to address.
Term insurance ownership remains to be an area of concern with only 30% adoption rates as opposed to 28% in IPQ 3.0 – denoting a 2% increase, the survey found.
India’s Tier II cities like Ludhiana, Jaipur, Patna and Pune beat metros in terms of buying term insurance or pure insurance products, as per a report.
There has been steady progress seen in preference of online channels to purchase term insurance, while agents remain the top channel of purchase with two out of three urban Indians opting for it, it said.
The latest study IPQ 5.0 was conducted among 3,500 respondents in top 25 cities.