- Group Term insurance owners are significantly more protected and secured than salaried non group term life plan (GTL) owners during Covid-19
- However only 57% of them feel that cover offered under employer group term is sufficient
- Salaried class continue to be higher on protection and knowledge index
- Self-employed surpass salaried professionals in term insurance ownership for the first time
1st March, 2021, New Delhi: Reinforcing its commitment towards ensuring greater financial protection for the country, Max Life Insurance Company Ltd. (“Max Life”/ “Company”) unveiled the findings of the third edition of its flagship survey ‘Max Life India Protection Quotient 3.0 (“IPQ 3.0”)’ in partnership with KANTAR. As per the survey, Group Term Owners (salaried professionals who own term life insurance offered by their employer) were found to be more financially secure than salaried non group term owners, and the term insurance ownership among the self-employed was observed to be increased during the pandemic.
In the backdrop of Covid-19, group term life (GTL) insurance owners displayed a higher protection index of 49 in comparison to salaried non GTL owners at 38. The survey revealed that the degree to which GTL owners are aware about life insurance products or knowledge index stood at an impressive 69 points, whereas it remained relatively lower for salaried non GT owners at 56. As a result, the former’s life insurance ownership levels stood at a higher 86% for salaried GTL owners in comparison to 68% for salaried non GT owners.
The survey also revealed significant changes in employees’ attitudes towards life insurance and continued financial coverage during unprecedented times. Around 65% respondents of group term life cover owners said that life insurance cover being offered by the employer was an important factor to decide on their employment with a company. Moreover, 56% salaried group term life cover owners and 53% salaried non GTL cover owners said that employers should offer life insurance advice to plan personal finances better.
Commenting on this, Aalok Bhan, Director and Chief Marketing Officer, Max Life Insurance said, “Faced with the possibility of a job loss, income decline and potential loss of health care, the Covid-19 pandemic heightened employees’ financial vulnerabilities. As a result, there was an increased focus towards savings and investments that could help combat unforeseen circumstances along with ensuring comprehensive financial protection. The insights also point towards the need for employers to assume a key role in helping their employees build long term financial resilience over the course of their employment.”
In addition to this, there was also a notable increase in financial protection levels of salaried and self-employed classes. Term insurance awareness of salaried class increased from 57% last year (as per IPQ previous 2.0 survey) to 62% this year, whereas term insurance awareness of self-employed jumped from 51% to 63%. Consequently, term insurance ownership also increased from 26% to 28% for salaried respondents and from 24% to 31% for self-employed marking a positive development as self-employed surpassed salaried in term insurance ownership for the first time.
The following findings reveal detailed insights across financial priorities and anxieties of salaried group term insurance owners, salaried non GT owners, salaried and self-employed cohorts:
- Group term insurance owners more secure across facets of financial protection
With financial security levels at 69%, group term life insurance owners were found to be more secure across different facets of financial protection even amidst the pandemic. Owning life insurance from their employers, 77% group term owners felt secure about financially catering to their child’s education whereas 74% felt secure about fulfilling family’s basic needs and 71% felt financially secure about their jobs/business.
As opposed to this, salaried non GT owners showcased financial security levels at an average of 56% and were less secure across various facets. Only 62% felt secure about fulfilling family’s basic needs, 61% felt secure about financially catering to child’s education, and 59% were secure about their jobs/business.
- However, only 57% group term life insurance cover owners feel life cover offered by employer group term is sufficient
Group term life cover owners also displayed high term insurance awareness and ownership of 73% and 43% respectively, as opposed to salaried non GTL cover owners, only 58% of whom were term aware and only 24% owned term insurance. Given this heightened awareness of financial protection, only 57% group term owners felt their group term life insurance cover (offered by the employer) was sufficient whereas 37% group term life cover owners said it was only somewhat sufficient and 4% said it was not sufficient at all. The same points at an opportunity for employers to engage with staff on insurance and related benefits conversation, motivating them to avail of greater insurance in the wake of Covid-19.
- Salaried class continue to be higher on protection and knowledge index in comparison to self-employed
The survey also witnessed that salaried class outperformed self-employed across protection, knowledge index, and security levels even as the latter displayed compelling progress. Both cohorts registered an increase in their overall protection levels – while protection index of salaried class increased from 37 last year survey (IPQ 2.0) to 41 now, that of self-employed rose from 35 to 39.
Knowledge index or life insurance awareness of salaried class stood at 59 which resulted in life insurance ownership of 72%. While knowledge index of self-employed class was at a relatively lower 55, the cohort owned marginally more life insurance at 73%. Despite this, the overall security levels of self-employed group stood at a lower 57% as compared to 59% of salaried group.
About India Protection Quotient
Instituted in 2019, India Protection Quotient is an annual survey by Max Life in association with Kantar aimed to understand the pulse of the Indian consumers in the financial protection space. Launched with the sub-objective to increase uptake of term insurance, as the most fundamental and economical form of life insurance, the survey aims to reveal the state of urban Indians with regards to current financial security levels, changing savings & investment patterns, key anxieties & triggers of financial protection in a contemporary world.
India Protection Quotient the degree to which Indians feel protected from future uncertainties, on a scale of 0 to 100, is a proprietary tool developed in partnership with Kantar. It is based on the attitudes, mental preparedness around future uncertainties, awareness, and ownership of life insurance product categories (term, endowment and Unit Linked plans).
About Max Life Insurance (www.maxlifeinsurance.com)
Max Life Insurance Co. Ltd. (“Max Life”) is a joint venture between Max Financial Services Ltd. and Mitsui Sumitomo Insurance Co. Ltd. Max Financial Services Ltd. is a part of the Max group, an Indian multi business corporation, while Mitsui Sumitomo Insurance is a member of MS&AD Insurance group.
Max Life offers comprehensive protection and long-Term savings life insurance solutions, through its multichannel distribution including agency and third distribution partners. Max Life has built its operations over almost two decades through need-based sales process, a customer-centric approach to engagement and service delivery and trained human capital.
As per public disclosures, during the financial year 2019-20, Max Life achieved gross written premium of Rs. 16,184 crore. As on 31st March 2020, the Company had Rs. 68,471 crore of assets under management (AUM) and a Sum Assured in Force of Rs. 913,660 crore. For more information, please visit the company's website at www.maxlifeinsurance.com
Kantar is the world’s leading evidence-based insights and consulting company. We have a complete, unique and rounded understanding of how people think, feel and act; globally and locally in over 90 markets. By combining the deep expertise of our people, our data resources and benchmarks, our innovative analytics and technology, we help our clients understand people and inspire growth.
- The study is conducted in top 25 urban metro, Tier 1 and Tier 2 cities; hence, its findings are representative of metro, Tier 1 and Tier 2 cities of urban India only.
- Metro – Delhi, Kolkata, Chennai, Bangalore, Hyderabad, Mumbai
- Tier 1 – Ludhiana, Jaipur, Lucknow, Patna, Bhubaneshwar, Vizag, Ahmedabad, Bhopal, Pune
- Tier 2 – Dehradun, Moradabad, Guwahati, Bokaro, Kolhapur, Jamnagar, Raipur, Ujjain, Hubli-Dharwad, Tiruchirappalli
- IPQ 2.0 Vs IPQ 3.0 data comparison is amongst 25 markets only [6 metros, 9 Tier 1 markets and 10 Tier 2 markets]
- The minimum sample to conclude any findings of the study is 270 with an error margin of +-5.964%.
Key cohort definitions:
- Salaried Professional – White collar professional (Clerical / Salesman, Supervisory Level, Officer/Executive – Junior, Officer/Executive - Senior / Middle)
- Self-employed professional – Includes individual not working for any specific employer/ managing their own business (includes shop owners).
- Group term life cover(GTL) Owner – Salaried professionals who own life insurance offered by their employer