Around two third of the policyholders participating in a survey said they have limited or no understanding of their insurance benefits and 60% of the dependents are unaware that they are even covered under any policy. The survey conducted by InsurTech CoverSure revealed that there is a significant gap between insurance ownership and coverage awareness among Indian policyholders.
A press release issued by CoverSure said the survey found that 79% of respondents are unsure of the adequacy of their coverage. This uncertainty points to a widespread risk of under-insurance, leaving a large segment of policyholders financially vulnerable despite having insurance.
Over 5,000 individuals participated in the survey across the metros and tier 2 and 3 cities. It uncovers major gaps in policy comprehension, family awareness, and management mechanisms.
The survey reveals that while insurance ownership in India is on the rise, policy awareness remains critically low. Around 71% of respondents hold between two to five active insurance policies, with life insurance being the most common at 63%, followed by health insurance at 24% and motor insurance at 13% percent.
Despite owning insurance policies, 65% of policyholders admit they have limited or no understanding of major policy details including benefits, exclusions, and claims processes. Only 35% claim to fully understand the benefits and terms of their policies.
The gap in insurance understanding extends beyond policyholders to their families. According to the survey, 60% of dependents are unaware they are covered under any policy, and only one in ten can accurately describe the coverage or benefits available to them. This lack of awareness often leads to misses in claim submission, claim rejections or policy not used effectively.
In addition, most people continue to rely on fragmented methods to manage their insurance documents. About 29% use physical files, 26% maintain spreadsheets, 24% depend on SMS alerts, and 21% store documents in digital folders. These disjointed approaches make it difficult to retrieve critical information when it’s needed most. It may further lead to challenging situations during raising claims and renewal of the policies.
While 36% favour engaging with human advisors, 26% are open to digital assistance. Surprisingly, 38% believe they need no help, even though most respondents lack clarity about their policies, highlighting a potential gap in awareness and decision-making. This self-reliance is notable, especially considering that most respondents showed limited understanding of their actual policy coverage—highlighting a clear gap between perceived and actual insurance literacy.
CoverSure founder and CEO Saurabh Vijayvergia said “If policyholders don’t know what’s covered or how to use it, the very purpose of insurance is defeated. While ownership is growing, true financial protection comes only when policyholders and their families are sure of their insurance. Policyholders need to make informed decisions, take ownership of understanding their policy and make insurance a topic of conversation amongst their family.