The COVID-19 pandemic has not only impacted people’s health but also their finances. The second wave of the virus in India during April and May 2021 led to a sharp increase in claims and affected the margins of insurance companies. As a result, many life insurance companies increased their term insurance rates by 20-30% due to a surge in premium rates by reinsurers as reported in rajkotupdates.news : corona third wave affect life insurance
Reinsurers have increased their rates by approximately 30% in the past year, leading to almost all life insurance companies increasing their premium rates by over 20%. HDFC Life, ICICI Prudential, and Bajaj Allianz Life are some of the companies that have already increased their term insurance rates, and others are expected to follow suit.
However, with the impact of the third wave still being studied, life insurers are taking a cautious approach before deciding on raising premium rates. Although the third COVID-19 wave’s mortality rates continue to remain in check due to vaccine penetration, the impact of the wave is yet to be completely understood. Therefore, life insurers are taking a more vigilant approach toward underwriting.
According to PolicyX ‘Insurance Price Index,’ the Term Insurance Price Index Value has gone up by 4.18% in Q4, 2021. If things go out of control, and there are more casualties, there may be a revision in rates of term plans going forward as reported in rajkotupdates.news : corona third wave affect life insurance
Buying life insurance early in life is recommended by experts as major price changes are reflected in the older age categories carrying higher risk. It’s also essential to compare prices before buying, as different companies offer different prices for the same coverage. The best way to buy insurance is to start early in life, as premiums increase as you get older and the risk to your life is higher.
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In conclusion, the COVID-19 pandemic has caused a significant impact on life insurance premiums in India. While some companies have already increased their rates, others are expected to follow suit. It is crucial to buy life insurance early in life and compare prices before making a purchase to ensure you get the best coverage at the best price.
