💡 Rethinking Group Life Insurance: The Missing Focus on Affordable Risk Coverage

 

“Insurance for All by 2047” is a powerful national vision — but achieving it requires more than just growth in premiums. It calls for a shift in mindset — from premium-driven strategies to protection-driven inclusion.

Table 1: Group Life Insurance data for FY 2024-25 (as on 31 March 2025) gives an interesting perspective.
It shows that Group Single Premium products account for over 93% of total premiums of Group Insurance — despite being high-cost instruments or mainly what we call funded schemes with some risk coverage. These are primarily designed for formal sector superannuation and benefit management, not for broad-based protection. Similarly, Non-Single Premium plans, though smaller in share, add to the cost of risk coverage.

In contrast, the Group Yearly Renewable Term Insurance (YRT) — the most affordable and flexible form of protection — contributes less than 5% of total premium income. Yet, it’s this segment that holds the real potential to expand coverage meaningfully.

Why?

• ✅ Cheaper risk coverage: With just about ₹2.48 premium per ₹1,000 sum assured, YRT plans can protect more lives at lower cost.
• ✅ Inclusivity: Can be extended to informal groups, SHGs, cooperatives, or microfinance-linked entities.
• ✅ Low capital strain: Requires lower solvency margins compared to Funded schemes –Investment heavy products.

If insurers realign their business strategies to emphasize such renewable term coverage, they can reach the vulnerable and underserved — the very backbone of India’s growth story.

The-takeaway:
To make “Insurance for All by 2047” a reality, the sector must prioritize coverage per rupee over Volume of premium . The future of inclusive protection lies not in the size of the premium book — but in the depth of the safety net it creates.

#InsuranceForAll  #FinancialInclusion  #AffordableInsurance #InclusiveGrowth #InsuranceStrategy #GroupInsurance #AshwaniSpeak #AshwaniThink #AshwaniNexus

Table -1-Group Life Insurance  data for FY-2024-25 as at 31st March 2025*
	Premium(Rs in Crores)	Sum assured(Rs in Crores)	Lives	% to Total Premium(Calculated In Rs)	Premium per thousand Sum assured (In Rs)(Calculated)
Group  Single Premium	212247.73	2129624	150608681	93.05	99.66
Group Non Single Premium	4539.55	118234	11162711	1.99	38.39
Group Yly renewable Premium	11321.38	4558467	95598500	4.96	2.48
Total	228108.66	6806325	257369892	100.00
*Data Taken from IRDAI site