BENGALURU, INDIA / ACCESS Newswire / August 5, 2025 / Rising uncertainties and changing lifestyles are placing a shift in consumer sentiment toward more future-proof financial tools.

As 2025 begins, Indian families are increasingly accepting the need for financial protection. Term insurance is witnessing unprecedented demand from both salaried professionals and entrepreneurial individuals, driven by rising healthcare costs, economic instability, and a widely observed increase in mortality awareness since the pandemic.

An increasing number of people now see term insurance as a necessary part of any sound financial plan rather than an optional security net. Term insurance is pure life cover, unlike any traditional-type savings plan or endowment policy. This lean and highly cost-effective product has begun to spur interest among a more diverse customer base that includes millennials and those buying insurance for the first time.

Affordable Yet High Coverage

Affordability is a key driver behind the growing demand for term insurance. It is economical. A healthy, 30-year-old non-smoker can get a cover of ₹1 crore at a low premium. In return, the nominee will be given a tax-free amount in the event of the premature death of the policyholder.

As compared to money-back or endowment policies, which involve both investment and insurance, term policies offer pure protection against risk. Therefore, it allows insurance companies to offer a larger sum assured at much lower premiums.

Term policies are also being offered with greater flexibility in customisations, such as:

• Critical illness riders

• Accidental death benefit

• Waiver of premium provisions

Such riders enable consumers to tailor the policy to their needs and life stages.

Digital Access and Instant Policy Issuance

Digital distribution of insurance has also been a major catalyst for term policy uptake. From premium quoting to KYC and medical disclosures, everything in the buying process of a policy can now be done online.

The availability of quicker insurance issuance has immensely appealed to young, tech-oriented consumers seeking instant and hassle-free coverage.

Regulatory Support and Tax Savings

Proactive regulatory initiatives also improved policy wording transparency, disclosure norms, and terms of claim settlement. At the same time, term plans continue to enjoy beneficial tax exemptions under Section 80C and Section 10(10D) of the Income Tax Act. For the salaried segment, this twofold benefit of financial protection coupled with tax efficiency is making term policies more appealing than ever.

A Necessity for Loan and Family Planning

As more and more people are taking home loans, personal loans, and EMIs, term insurance is now proving to be a safeguard of wealth against the debt burden on their supporting family members.

Most financial planners today recommend buying term insurance to cover outstanding loan balances in case of untimely death. Term plans are also important tools, especially in nuclear families where one earner is taking care of multiple dependents.

Changing Buyer Profile in 2025

Term insurance was once a middle-aged purchase. But in 2025, the buyer profile shifts. There is growing involvement by:

• Women professionals

• Freelancers and gig economy workers

• Young urban parents

• First-time job seekers

This shift is mostly due to increased financial knowledge, targeted online promotions, and real-world reminders about the necessity of being prepared. Financial advisors nowadays suggest buying a term plan as early as possible. Premiums are lower, health risks are minimal, and long-term cover is guaranteed.

What to Watch Out For

Despite the benefits, buyers must carefully read the fine print. All term policies are not identical. Key parameters to check are:

• The company's claim settlement ratio

• Premium-to-sum assured ratio

• Riders offered

• Waiting period for named diseases

• Exclusion terms

Also, be wise to periodically update nominee details and inform family members about the policy and the claim process.

Bottom Line

With India becoming more financially savvy and digitally empowered, term insurance is no longer 'if' but 'when'. Its low-cost structure, increasing digital accessibility, and enhanced customisation make it one of the most practical financial tools for modern households.

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SOURCE: Acko