According to a survey[1], after the instability in incomes caused by Covid-19, a surprising 32 percent of the Indian Gen Z are inclined toward saving more than spending, and only 5 percent said they’d choose leisure over saving. Yet life insurance still doesn’t find many takers in that generation because they look for return on investments and lucrative bids, and don’t understand the importance of being prepared for emergencies. By not buying a policy at an early age, they miss out on lower premiums which could have led to a reduction in their total expenditure on life insurance over the course of time.

Another survey conducted[2] across India among around 1,800 people in the age group of 18-35 revealed that people are underinsured. Only eight percent of respondents have a sum assured higher than eight times their annual income. Usually, experts suggest that one should have a life cover that is at least 10 times the annual income. The problem with being reluctant about taking insurance at an earlier age is that as responsibility increases and the fear of retirement starts ringing bells after the age of 40, many rush to save for retirement or protect their family with term insurance or a whole life insurance policy.

Premiums for whole life insurance, ULIPs, and endowment and retirement plans do get expensive when you reach 40, but they do offer a substantial corpus at retirement. Now, with most insurers increasing their term insurance entry age limit, today even individuals over the age of 60 can avail term insurance. For instance, Future Generali Care Plus has an entry age limit of 65 years with life coverage up to the age of 85 years. It offers a high life cover at an affordable premium.

  • Why term insurance for senior citizens is critical

    Most people think that buying term insurance for senior citizens is not important; it may be right to some degree as they have already crossed or reached the age of retirement. However, not every person above 60 retires with an ideal financial situation. What if their children don’t have a decent job? What if their retirement planning was not successful? In the following cases, a person above 60 years will require term insurance:

  • When children are financially dependent

    According to the “State of Working India 2023” report[3] by Azim Premji University’s Centre for Sustainable Employment, over 42 percent of India’s graduates under 25 were unemployed in 2021-22. In many families, some children are still getting an education or training to get a job, while their parents are already in their 60s. All the education and daily expenses of children are being borne by the parents. In such a situation, term insurance taken by the parents protects their children in case of their unfortunate demise.

  • When you have outstanding debts and liabilities

    It’s not rare to see people working well after their retirement age to pay off debts such as a home loan, personal loan, or education loan for their children. What happens if the earning member of the family passes away? Who will pay off the loan? Well, there’s term insurance to take care of that. Term life insurance offers much-needed financial protection to the family to pay off debts and liabilities and live a decent life.

  • When you care about your spouse

    You have seen the ups and downs of life together, but life is unpredictable. Your spouse will be left alone to take care of your children, and it’s going to be tough for them without financial protection. A term insurance plan is the least you can do for your family whether you are in your 30s or 60s to protect them in your absence.

Conclusion: Life insurance penetration, which stands for new business premium for the year calculated as a percentage of the GDP, is abysmally low for India. IRDAI data shows[4] that India’s insurance penetration was 4.2% of the GDP in 2021-22. Thus, in terms of penetration, India is far behind the global average of 7% of the GDP. Even term insurance, which is relatively cheaper than other forms of life insurance, also has few takers in the country.

Indians are yet to give life insurance the importance it deserves, and most individuals go for life insurance quite late in their life, which then becomes costly to purchase because of higher premiums.

With insurance companies increasing the entry age for insurance plans, you get a longer duration to opt for life insurance. The premium will surely be higher when you opt for an insurance plan later, but don’t let it discourage you from getting term insurance protection even if you are well over 60 years. It’s better late than never. The little extra you’ll be spending now will go a long way in taking care of your loved ones in your absence.

Future Generali Care Plus : This is an Individual, Non-Linked, Non-Participating (without profits), Pure Risk Premium, Life Insurance Plan. UIN: 133N030V05