The Funny Route Life Insurance Companies in India chose to Bridge the Gap in Insurance Cover

Startups often struggle to find a healthy balance between becoming and staying relevant, with marketing and sales, and competition and growth. Their efforts and struggle, while not necessarily always logical, is usually understandable.

However, one cannot extend a similar courtesy of understanding to large corporate giants in mature sectors who miss the forest for the trees.

Take life insurance companies (here in India) for example. The biggest of them have been using banks to push expensive and often unsuitable term plans onto unsuspecting and ill-informed customers. Customers who, per the article here, 49% of whom discontinue these policies within five years, at a considerable financial hit to themselves.

That is not poor business on the part of term insurance companies and banks. It is deeply irresponsible and reckless action. Especially at time when India has been found to be highly under-insured. As per a Financial Express article from earlier this year, India has a total sum assured of about 70% of GDP, which is dwarfed in comparison to the US (251%), or even Thailand (143%) – leaving a large protection gap exposed.

Amusing that insurance companies think they can use this sneaky approach to build trust and bridge that gap.

Read more in this interesting and concerning article:
https://www.financialexpress.com/money/almost-half-of-life-insurance-holders-quit-paying-premiums-within-5-years-the-reason-will-surprise-you-3873293/