Life insurance in India is mainly driven by savings and family financial security, with relatively lower importance seen on retirement and future planning for children, according to the findings of Canara HSBC Life Insurance's "Perfect Plan Ka Partner" survey.
The comprehensive study also explored how well-prepared Indians are for the future and how they managed their savings and insurance.
In partnership with an independent survey agency, Canara HSBC Life Insurance carried out the poll to understand how individuals across various age groups and cities in India prioritise their financial future. The survey encompassed 800 participants aged 20 to 50 from eight Tier 1 and Tier 2 cities.
The findings reveal a striking reality. Approximately 70% of Indians are setting aside immediate desires, like purchasing a home or taking a much-needed vacation, to prioritise their family's financial security. Savings and securing the future of their loved ones emerge as the primary reasons for opting for life insurance policies.
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Top reasons for getting life insurance and % of those polled who selected them
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Reason
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Proportion of respondents
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Savings
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57%
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Financial Security for family
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44%
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Retirement planning
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26%
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Children’s future
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26%
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Source: Canara HSBC Life Insurance’s “Perfect Plan Ka Partner” survey
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However, this focus on family often comes at the expense of other financial goals, with 60% of individuals zeroing in on just one priority—family financial security—while overlooking the importance of savings.
Other findings are:
Term insurance
Delving deeper, the survey revealed that 64% of individuals wished they had begun their term insurance journey sooner. Despite 83% acknowledging the importance of term plans, a mere 11% take the time to review their coverage annually. This lack of regular assessment left only 25% of Indians feeling confident that their policy will sufficiently cover unexpected expenses.
Retirement planning
While 66% of Indians start planning for retirement in their 30s, a staggering 74% regret not starting earlier. This delay has left only 27% feeling prepared for retirement, and just 24% believed their maturity amount will fully meet their financial needs.
Planning for children's future
Only 18% of Indian parents feel fully prepared, and an equal percentage believe their policy's maturity amount will be enough to secure their child's future. The regret is palpable, with 71% wishing they had started the policy sooner and 82% of parents feeling unprepared for their child's financial needs.
In addition, the findings showed:
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75% of Indians felt that their policy cover will be insufficient in an emergency.
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29% that their policy cover will be insufficient in an emergency.
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11% of Indians reviewed their insurance every year.
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70% of Indians felt that they cannot achieve financial stability through their planned savings.
Commenting on the survey findings, Canara HSBC Life Insurance chief distribution officer - alternate channels and chief marketing officer Rishi Mathur said, “These findings emphasise the need for early and regular financial planning.”
Mr Mathur also said, “We believe that with the right guidance and timely decisions, every individual can achieve their financial aspirations and secure a better future for themselves and their loved ones.”
Established in 2008, Canara HSBC Life Insurance Company is a joint venture promoted by Canara Bank (51%) and HSBC Insurance (Asia Pacific) Holdings (26%). Punjab National Bank is also a shareholder of the Company, holding 23% as an investor. With its head office at Gurugram, the insurer has a network of more than 100 branch offices across India.