By 2030, the annual women’s insurance market in India is predicted to be worth $22 billion–35 billion. In its report, SheforShield: Insure Women to Better Protect All, insurance company Bharti AXA stated that this amount is approximately two to four times the estimated premium of $10 billion spent by women in 2013. The report is the India chapter of the global research report by AXA and International Finance Corp.
The insurance industry has largely overlooked women as a key customer segment, despite significant growth potential in the market. In 2013, women spent $0.05 billion on health insurance premiums; by 2030, this can reach $0.1 billion–0.16 billion per annum. Life and non-life segments are expected to grow at similar rates, from $8.6 billion (life) and $1.1 billion (non-life) in 2013, to $17.7 billion–27.6 billion and $4.4 billion–6.9 billion, respectively, in 2030.
Improvements in socioeconomic conditions: The percentage of women with tertiary degrees has doubled from 2008 to 2014, while women’s income has increased by more than 20% over the period. Women who can afford insurance are willing to spend on health and life products, which represent a particular area of growth. Greater financial inclusion and career prospects are allowing leading to accumulation of wealth and assets, creating a need for and an ability to increasingly afford protection and savings products.
Growing awareness of insurance: Social security, insurance, and pension were in focus during the Indian national election campaign in 2014. Following the election, the finance minister announced in February 2015 the introduction of a universal social security system, which will give the population access to subsidised insurance and pensions and provide coverage for accidents and death.
Rise in number of women’s unions and entrepreneurs: The Ministry of Micro, Small, and Medium Enterprises (MSMEs) estimated that the number of women-led businesses in India grows by 4.51% annually, and around one-third of India’s early-stage entrepreneurs are women.
The total supply of formal finance to women-owned MSMEs in 2012 was around $42 billion, resulting in a finance gap of $116 billion, or 73% of the total demand.
While there is no mandatory insurance coverage in connection with entrepreneurship, the higher stakes for women running their own businesses are likely to raise their willingness to purchase insurance.
Why aren’t more women buying insurance?
Women are still not sufficiently served by the insurance industry and the lack of awareness on insurance benefits remains a key barrier.
Moreover, for many women, commercial insurance products are simply too expensive despite increases in incomes overall. Women only make up 20-30% of insurers’ portfolios, based on statements by insurance companies. Several insurance products that cater to women are currently being offered; however, few have been successful.
Although insurance awareness is growing, in some areas, lack of compulsory insurance and low levels of education limit women’s exposure and literacy in insurance products. Also, women tend to rely on savings, rather than insurance, in case of a health emergency.
How can this change?
To tap into the women’s market, insurers need to develop education campaigns, strengthen distribution channels, and develop product features to meet their needs. Pricing needs to be reviewed. Bundled entrepreneur products can support the growth of the women’s entrepreneur market.
Insurers need to build programmes designed to enable women to better understand the concept and advantages of insurance. They should specifically focus on the most common types of risks women face for which insurance can offer peace of mind and provide a real safety net against the unknown.
Furthermore, leveraging women in the salesforce to sell products to women clients is an option. While there are efforts to increase the number of women agents, approximately 75% of them are still men. Employing women agents in rural areas can help insurers reach out to the near 70% of the population that lives in such areas.
Insurers should also conduct in-depth research on what women expect from health insurance. According to the World Bank, women in India have the highest amount of loans outstanding for health and emergencies. Insurers need to conduct research to find out what women need from health insurance policies. Programmes on benefits of insurance for their children, the household well- being, and retirement needs will help put insurance into a relevant context.
Edited excerpts from a Bharti AXA report , SheforShield: Insure Women to Better Protect All.