India’s ageing population faces a silent crisis: Are your retirement plans truly ready for old-age care?

While we’ve made significant progress in increasing life expectancy and building retirement solutions, we have overlooked one of the most critical needs of old age: care. Not hospitalisation, not medication—but everyday human care.

Retirement planning today is primarily focused on financial instruments such as pension funds, savings schemes, or annuity plans. But what happens when ageing brings with it Parkinson’s, dementia, severe arthritis and extreme loneliness, and your real need is for someone to help with your daily tasks: taking a bath, putting on clothes, taking your medicine and eating a meal?

This is the silent crisis we’re heading toward, and it’s time we addressed it head-on with a dedicated solution: senior care insurance. Such a product would cover the real costs of caregiving in old age—not just in hospitals, but at home, day after day.

We’re living longer, but not healthier

India’s life expectancy has increased to more than 70 years, according to the World Health Organization. But we must ask: are we living well in our seventies and eighties, or merely surviving?

Conditions such as diabetes, arthritis, Alzheimer’s, and cardiovascular disease are on the rise. A recent study revealed that around 10% of older Indians report having difficulty with basic tasks such as eating, bathing or walking, and more than half suffer from at least one chronic condition.

This is no longer a niche concern—it’s a national one.

For previous generations in India, elder care was a family affair. Now, many elderly people live alone or with minimal support. Seniors struggling with reduced mobility or memory loss depend on hired help, and stories of abuse and neglect are all too common. For those who can afford it, senior living communities or assisted-living centres offer some relief. But these are expensive.

We’re witnessing the emergence of a two-tiered ageing experience: the wealthy have options, while the middle class and lower-income groups are left to fend for themselves.

What senior care insurance could look like

This is where the insurance industry can step up. Just as life insurance protects us from unforeseen shocks, senior care insurance could help us bear the financial and logistical burden receiving care in old age.

Here’s a potential model: A person in their forties or early fifties buys a long-term senior care insurance plan. They pay premiums for 15 to 20 years, similar to a retirement or life insurance policy. After a specified period, if they are diagnosed with lifestyle or age-related conditions such as Alzheimer’s, Parkinson’s, dementia, or severe mobility impairment, they are eligible for coverage.

The payout can happen in two ways:

• In-kind support: The insurer partners with verified caregiving agencies to provide trained in-home attendants, nurses, or physiotherapists. The customer receives professional care at home for rest of their life in lieu of the premiums paid.
• Cash benefit: A monthly payout is transferred to the policyholder to cover expenses such as hiring help, buying assistive devices, or managing transportation for medical visits.

A hybrid model could offer flexibility, allowing policyholders to choose a mix of both.

Crucially, the insurer could play the role of care coordinator, offering not just money but co-creating a vetted caregiving ecosystem. This would make the entire process more transparent, safe, and structured—especially in a country where informal caregiving is often unregulated.

Why insurance is the right industry to lead this

Insurance companies already manage risk, create structure around uncertainty, and design products that serve both long-term needs and large populations. Life and health insurers have the ability to pool risk, offer flexible payment options, and partner with service providers to scale care delivery.

Globally, such a model is not new. Countries such as Japan and Germany have already implemented long-term care insurance systems—publicly funded and universally accessible—that cover a range of home- and facility-based care services. While India may not yet be ready for a government-backed model, there is clear opportunity for the private insurance sector to take the lead.

With proper regulatory guidance, responsible partnerships with service providers, actuarial modelling, and appropriate product design, senior care insurance can become as commonplace as life or mediclaim policies in the coming decades.

The time to act is now

India is still a few decades behind other countries in elder care planning, but that gap can be closed if we act today. The current demographic shift offers a unique opportunity. As Millennials and Gen X-ers move into their peak earning years, they are also becoming more aware of ageing—both their own and their parents’.

For this group, senior care insurance wouldn't be just a smart financial move – it would also help ensure that their twilight years aren't defined by helplessness, but by dignity and independence.

We need to stop thinking of retirement planning as just saving money. It must also include planning for care—physical, emotional, and practical. The insurance industry is best-positioned to make this happen.

The biggest risk isn't dying too early. It’s living too long, without support.

Maneesh Mishra is chief product and marketing officer at Bandhan Life.