Hyderabad: More than 60 per cent of Indians are thinking of buying health insurance after facing a hefty hospital bill or learning of such an experience from friends, according to a survey conducted by Policybazaar.com. According to the findings of the survey, nearly one in three Indians are thinking of buying health insurance, motivated by the fear of COVID-19 this year.
Policybazaar.com surveyed more than 4,000 existing insurance buyers to understand the attitude of Indians and their purchase triggers when it comes to life, health, and vehicle insurance. The annual survey was conducted as part of the National Insurance Awareness Day celebrated on 28 June every year. The survey was fielded to respondents between 19 and 23 June.
About 58 per cent of the respondents took into account the insurer’s claim settlement ratio. When choosing health insurance, two in three Indians make a decision based on the network of hospitals it covered. Nearly seven in 10 respondents purchased a term insurance plan to protect their family’s financial future and not merely as a tax-saving instrument when it comes to life insurance. This healthy awareness about the purpose of insurance is encouraging for a country with a low level of insurance penetration.
The findings mark an improvement in the number of people buying term insurance for long-term security (seven out of 10 vs six out of 10) compared to 2019. Those who are aware of the purpose of insurance were mindful of opting for a cover 10 to 15 times their current annual income, as is usually recommended by financial experts.
About 51 per cent of the respondents felt the ideal insurance cover was 20 times their current annual income, given the uncertain economic crisis. Nearly a third of the respondents were influenced by friends and 25 per cent by online media while deciding on investing in life insurance. According to the survey, peer group and friends’ networks have emerged as significant triggers for life insurance purchases.
According to Policybazaar.com, rising healthcare costs in general and the recent reports of astronomical COVID-19 treatment costs at private hospitals have changed India’s attitude towards insurance and especially health insurance.
While the overall awareness about vehicle insurance grew, it is still seen as a matter of compliance. Three in four respondents said they were aware of the benefits of third-party insurance, compared to 60 per cent last year.
Awareness about zero-depreciation cover also increased to 70 per cent from 50 per cent last year. Nearly 60 per cent of the respondents knew that they could renew their lapsed motor insurance policy online, and eight in 10 understood that an electronic copy of motor insurance was a legally valid document.
“The increasing awareness about the importance and purpose of insurance among Indians is very encouraging. A well-insured nation is better equipped to deal with public health crises and economic uncertainties. The findings of the survey will help insurance companies in India tailor and market their products with greater precision,” said Sarbvir Sigh, the CEO of Policybazaar.