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Shocked by Covid Deaths, Young Indians Rush to Find Life Insurance | India News


BENGALURU: Like many other twenty-somethings in India, Beverly Coutinho kept putting off buying a life insurance policy, until a spike in Covid-19 cases and deaths made her face her own mortality.
“I saw people my age die, which prompted me to buy life insurance immediately,” says Coutinho, a 24-year-old senior executive at a public relations agency in Mumbai.
“I don’t want my family to be in a situation where they have to fight for funds if something happens to me.”
The official tally puts the death toll from Covid-19 at 380,000, the third highest after the United States and Brazil, though experts say India’s numbers are grossly underestimated due to low levels of testing for the virus and likely more people have died. in India than anywhere else in the world.
When a devastating second wave of the pandemic peaked in India during April and May, the number of people between the ages of 25 and 35 who purchased term insurance was 30% higher than in the previous three months combined, PolicyBazaar said. , India’s largest online insurance aggregator.
Term insurance purchases through the online insurance aggregator InsuranceDekho website increased 70% in May compared to March.
Insurers did not disclose how many plans they sold, citing commercial confidentiality, but many said it was in the “thousands.”
“The current pandemic has led to increased awareness of the need for financial protection and the inadequacy of current insurance coverage,” said Niraj Shah, chief financial officer for HDFC Life Insurance.
Shah’s firm said it had seen increased demand for protection products from the under-35 age group since the pandemic first hit India, about 15 months ago.
Industry executives say insurance plan inquiries have skyrocketed even as the second wave of infections subsided, likely due to strong prospects for a third wave given India’s slow start to the mammoth task of vaccinating. to his people.
Stock market investors still seem unsure whether buying life insurance stocks is a good bet during a pandemic.
Since the beginning of the year, the benchmark NSE Nifty 50 index has gained 13.5%, while HDFC Life Insurance shares are up just over 2%, SBI Life Insurance is up around 10% and ICICI Prudential Life Insurance is up almost 18%.
“Over the long term, investing in insurers makes sense as awareness of insurance has grown,” said Saurabh Jain, assistant vice president for research at SMC Global Securities in New Delhi. But he added that high valuations and an increase in the number of claims due to the first and second waves were a concern.
Despite the lack of firm figures on the growth of the life insurance market, industry analysts see a change in the behavior of middle-class families in a country that has traditionally had low levels of coverage.
“After clothing, food and home, insurance has now become the fourth pillar of a middle-class family,” said Ankit Agrawal, founder and CEO of InsuranceDekho.
Life insurance penetration among the Indian population was 2.82% in 2019, compared to 2.15% in 2001, the latest annual report from the Insurance Development and Regulatory Authority showed.
That’s still well below the world average of 3.35% in 2019, but then a large chunk of India’s 1.35 billion people lack the disposable income to reserve for insurance, a situation that is further exacerbated by the economic fallout. of the pandemic.
Term insurance plans are popular in India because they are often cheaper and pay the family if the insured dies within the policy payment period, although there is no expiration benefit if they survive the plan. The demand for other types of insurance has also increased, including various medical coverage.
“If someone was thinking of buying insurance, they are actually doing it now,” said Avneesh Sukhija, senior financial analyst at BNP Paribas India.

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