Amid the COVID-19 pandemic, trends suggest that Indians are purchasing more term life insurance plans than ever before. The boost is coming from the lower-income group, which has emerged as a new category.
The economically weaker section, according to Sajja Praveen Chowdary, Head-Term Life Insurance, Policybazaar.com, are focusing more on purchasing Saral Jeevan Bima.
“Saral Jeevan Bima has been successful in providing a minimum level of coverage to many others who were previously unable to purchase a term life insurance plan due to a lack of sufficient financial income or education. This plan provides a higher issuance rate for the lower-income segment groups compared with the other term plans available,” said Chowdary.
The plan has a minimum coverage amount of Rs 50,000 and a maximum cover amount of Rs 25 lakh.
Talking about the statistics surrounding Saral Jeevan Bima's popularity, Chowdary pointed out that customers investing in Saral Jeevan Bima have an average income range of Rs 3–3.5 lakh.
Furthermore, he added that the demand for standard term life insurance plans is highest among the middle-aged group, with nearly half of all customers – nearly 50 percent – purchasing Saral Jeevan Bima between the ages of 31 and 40, followed by 25 to 30 – 22 percent, and 41 to 50 – 18 percent.
“People in their early 30s and late 40s typically have significant expenses to consider, such as their children's education and marriage, as well as repaying any loans and planning for a secure retirement. Gender differences can also be seen in terms of customer participation in Saral purchases. While 80 percent of the male population buys term life insurance, only 20 percent of the female population believes it is equally important to protect their lives with an adequate term life insurance plan, according to Jeevan Bima," Chowdary stated.
Meanwhile, insurers have devised new ways to obtain income proofs for Saral Jeevan Bima, in particular, to make the process easier for first-time buyers.
As a result of this practice, Chowdary added that the lower-income segment's term life insurance policy issuance rate has increased to 70 percent from 30 percent previously.
Here's a look at premium offerings of different insurers on 'Saral Jeevan Bima':
|PNB Met Life||7859||10195||14207||NA|
|Edelweiss Tokio Life Insurance||10429||13605||18218||24919|
|Exide Life Insurance||16277||20243||26160||34295|
Note: These offerings are for cover up to 60 years, where the sum insured is Rs 25 lakh.
(Edited by : Abhishek Jha)
First Published: IST