COVID-19 may have triggered panic across the world. But the pandemic-induced nationwide lockdown has also led to fewer death claims for some life insurers in India.
“Our claim experience in April-June 2020 has been better than last year. This could be on account of fewer accidents during the lockdown period, as there were restrictions on mobility,” said Prashant Tripathy, MD and CEO, Max Life Insurance, speaking at the launch of its India Protection Quotient – COVID-19 edition study. The company has received around 35 COVID-19 claims so far. It has also seen a significant increase in demand for pure protection term insurance policies and critical illness riders, as more individuals seek to secure their dependents financially in uncertain times such as these.
Not feeling sufficiently protected
The Max Life Insurance-KANTAR survey, which polled 1864 individuals between 25 to 55 years of age across 24 metros, tier-1 and tier-2 cities between June 23 and July 4, 2020, revealed a protection quotient of 47. “(This), despite a relatively high awareness and better ownership of life insurance products by the digitally savvy, urban respondents,” the study noted. The India Protection Quotient (IPQ) reflects the degree to which Indians feel protected from future uncertainties in light of the current COVID spread, on a scale of 0 to 100. The respondents scored much higher as far as knowledge (68) and ownership of life insurance (79) was concerned.
“Amidst the COVID-19 crisis, half the respondents are feeling attitudinally less secure on financial aspects. Women feel less secure at 47 per cent as compared to men at 53 per cent. The percentage of financial security among millennials and non-millennials was almost the same, at 51 per cent and 52 per cent, respectively,” the survey found. However, fewer millennials (75 per cent) own life policies compared to non-millennials (80 per cent).
Metro respondents felt financially less secure on a relative basis, due to better awareness about COVID-19. Also, these cities are the worst-hit by the pandemic. Overall, 64 per cent respondents in metros said that security of job, current business and stable income happen to be more of a worry for them now than before COVID-19. This proportion was much lower at 51 per cent in Tier 1 cities. Likewise, 57 per cent of those polled in metros, against 53 per cent in Tier 1 cities, admitted that their family’s financial security in the absence of the breadwinner is more of a concern now. “Inadequacy of funds in case of critical illness is a bigger anxiety for 57 per cent respondents in metros as against 49 per cent in Tier 1, as compared to before COVID-19,” the survey stated.
Life insurance ownership and security levels were lower for women in comparison to men, with 73 per cent women as against 78 per cent men owning life insurance. While 53 per cent men said they felt financially secure, only 47 per cent women expressed similar sentiments. Also, 59 per cent women in comparison to 50 per cent men felt more worried now than before coronavirus about inadequacy of funds to meet critical illness costs. While 58 per cent of women said they were concerned about job security and income stability now, the proportion of men who expressed these concerns was lower at 54 per cent.
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