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A study done by PolicyX.Com, an online insurance distributor shows that delaying a purchase of a term policy by 10 years could get expensive on clients’ pockets.
It stated, “Delaying a purchase of a term policy by 10 years could cost on an average 48.6% higher for a 25-year-old, 72.7% higher for a 35-year-old and 89.1% higher for a 45-year-old.”
Overall, it reported a 2.57% rise in the average term insurance premium as against the last quarter. The premiums increased from Rs. 26,019 to Rs. 26,687. “Term insurance prices, being highly vulnerable to external factors such as competition, mortality rate, and demand, often lead to change in average premium prices”, explained the report.
However, there was a mixed trend across insurance companies. While some increased their premiums, a few kept them either the same or lower.
The report also highlighted premium prices across age categories for both genders.
These figures reflect higher premiums for men viz-a-viz women. This variation is due to insurance norms that state men carry a higher risk of life than women. Additionally, the figures also account for smoking habit, which increases the premium by over 50% in certain cases.
Methodology
PolicyX.Com has based its findings on the average premium prices of 5 life insurance companies - Kotak Life Insurance, HDFC Life, ICICI Prudential, Max Life and Bajaj Allianz Life.
The prices represent the average annual premium payable as on quarter ended June 2023 for different profiles based on age, gender, and smoking status. However, the insurer’s individual rate may vary depending on various factors.
