Empowering women with financial planning: Term insurance as a safety net

Women, with their incredible capacity to fulfil various roles as caregivers and providers, navigate a delicate balance in their lives. Amidst the demands of nurturing their families and contributing to household finances, they often overlook the importance of prioritising their own well-being. While they diligently attend to the needs of loved ones, it's crucial for women to recognise the necessity of self-care, including securing adequate insurance coverage for themselves. After all, safeguarding their own health and financial stability is essential for ensuring long-term resilience and security for both themselves and their families.

The low insurance coverage among women in rural India is even more worrying, with only 1% being insured, as per a recent report. There’s a significant requirement for women to make independent financial decisions. While women are equal contributors in household chores irrespective of their employment status, in many homes, women still rely on their spouses when it comes to managing finances. In urban areas, there's a noticeable shift in mindset mirrored by the innovative approach taken in products targeted towards this segment. In fact, major insurers offer high coverage plans to women at affordable premiums and also cover cancer as part of their critical illness riders.

In fact, Policybazaar’s data indicates a 12% growth in ownership of term insurance in the first quarter of FY’24. More women now want to invest in a financially secure future to protect their loved ones.


Term insurance: A vital need for homemakers
Unfortunately, there’s a common misconception that homemakers do not require term insurance, which couldn't be further from the truth. Homemakers play a pivotal role within households, encompassing various responsibilities such as caregiving for both the elderly and the children, managing household chores, and other duties. Yet, their immense contributions often go unnoticed, and it's nearly impossible to quantify the value of their round-the-clock dedication, which doesn't allow for any breaks.

Even if we momentarily set aside the sentiment and objectively evaluate the economic worth of a homemaker, it would equate to the collective expenses incurred in hiring a nurse, tutor, chef, and domestic helper. Engaging these professionals entails a substantial financial outlay, which can become particularly burdensome for families navigating periods of grief and stress. During such challenging times, term life insurance serves as a vital financial buffer, providing essential protection for the family's well-being.

Fortunately, term plans now offer coverage of up to Rs. 1 crore, with flexible eligibility criteria designed to make term insurance readily accessible to homemakers. The eligibility also extends to homemakers who have completed at least 12th grade and have an annual household income of Rs. 5 lakh or above.

Affordable plans with higher coverage for working women
Life is neither easy for a working mother nor for self-employed moms. They need to constantly juggle between work and home responsibilities leaving no time for their self-care. They work tirelessly and often end up putting the future of their family ahead of their own well-being. Whether they are the only earning member of the family or contributing to the family income, their absence will put a significant strain on household finances. Hence, getting themselves insured is imperative for the financial protection of their loved ones in an unfortunate incident. Working mothers may require a larger cover as compared to their spouses owing to the financial as well as domestic contribution to the family.

Likewise, women entrepreneurs also navigate the challenges of balancing work and family responsibilities. Running a business is not an easy feat, as it entails overcoming obstacles and managing uncertainties. Managing a home along with a business demands constant negotiation of priorities and unwavering determination. Though they may not have a monthly paycheck, they contribute immensely to the household income. This facilitates the need for securing a term insurance plan. The insurance industry is evolving and adapting to the changing needs of consumers. There are special plans that don’t require income proof specially catering to the demands of self-employed mothers.

It should be noted that women have the advantage in term insurance premiums being up to 30% more affordable, due to their longer life expectancy and lower mortality rates. This benefit originates from healthier lifestyle habits, genetic influences, patterns of healthcare utilisation leading to tangible financial advantages for women who choose term insurance.

Financial protection- A priority
Personalised insurance plans have significantly impacted women’s financial freedom. By obtaining sufficient coverage, women can shield their families from financial struggles in case of unexpected events like illness, disability, or death. In fact, plans like Bajaj Etouch offer health benefits worth up to Rs 36,500 every year exclusively to female customers.

A comprehensive approach is required to address the lower penetration of insurance among women. To solve this problem, it is equally important to sensitise both men, women, and families about the importance of insurance for women. Through collaboration, insurance companies, regulators, and stakeholders can advance the development of a more inclusive insurance ecosystem, enabling women to safeguard themselves and their families effectively.

Author: Rhishabh Garg,
Head, Term Insurance,
Policybazaar.com

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