Term Insurance: Self-employed people are increasingly requesting policy coverage of more above Rs 1 crore.

They see term insurance as an essential instrument for protection as they approach significant life milestones, such as starting families and professional jobs. Additionally, this segment strongly prefers monthly premium payments for improved budget control and cash flow flexibility.

The need for term insurance among India’s self-employed population is expected to increase dramatically as their numbers continue to grow, according to Varun Agarwal, Head of Term Insurance at Policybazaar.com. Custom term plans that do away with the necessity for conventional income documentation, such ITRs or pay stubs, are the main driver of this expansion. These days, digital measures like creditworthiness, loan history, and surrogate proofs like vehicle IDV are used by insurers to assess financial soundness.

Women Self-Employed Term Insurance buyers grow from 9% in FY 20 to 15% in FY25

“The remarkable rise in female-led start-ups is indicative of women entrepreneurs’ growing understanding of the significance of safeguarding their families’ futures.” According to the survey, women’s growing financial awareness and control over their finances, especially in major cities where women-led firms are thriving, are the reasons behind the surge in term insurance adoption.

Dominance of Rs 50 lakh cover amount

The majority of independent contractors choose term insurance plans with a Rs 50 lakh sum insured, which is 10% more in FY25 than FY24. There is a discernible and growing trend of self-employed people acquiring term insurance policies with coverage limits of Rs 1 crore and higher in the face of growing inflation and living expenses.

Top markets driving demand for term insurance among self-employed individuals

The first metropolises to acknowledge term insurance as an essential instrument for financial planning are Delhi, Bengaluru, and Mumbai. With more small business owners and self-practicing professionals, cities like Pune, Hyderabad, and Chennai are also seeing an increase in the demand for term insurance among independent contractors, especially for reasonably priced coverage alternatives.

Accidental death benefit and waiver of premium tops add-ons for self-employed term insurance buyers

Even in the event of an unplanned accident, these add-ons offer an additional degree of security, guaranteeing the financial stability of their families and enterprises. Additionally, self-employed people might choose to use the Married Women’s Property Act (MWPA).