Life insurance protection (term) plans, though cost-effective, have found few takers in recent years. The value proposition is huge, but it is yet to gain popularity among customers. ICICI Prudential has been focusing on this high-value but least-appreciated product to create awareness and educate customers about pure protection products, said Sandeep Batra, Executive Director, ICICI Prudential Life Insurance Company, in an interview with BusinessLine. Excerpts:
Why do you think people are reluctant to buy term plans?
The perception towards protection is that one does not get anything in case one outlives the policy term. Most people overlook the fact that it provides financial security to the family if the policyholder dies before completion of the term.
The rates for protection premiums have fallen by over 50 per cent in the last 15 years due to increased awareness about healthy living and availability of rich data on mortality collected by life insurers.
A life cover of ₹1 crore (for a 30-year-old male, for a 20-year term) that used to cost about ₹35,000 a year, is today available for around ₹8,000. We insure our goods, property and other assets against damage or loss, but life, which is the most important aspect, is left uninsured. While property can be rebuilt, life lost cannot be replaced.
