Policybazaar conducted an online survey to closely analyse consumer awareness levels and uptake of emerging protection products in India to observe the National Insurance Awareness Day 2022. The brand surveyed over 4500 of its customers and app/website visitors regarding relatively lesser-known products including cyber insurance, mental health insurance, home insurance and pet insurance.
The overall findings of the survey depicted a huge scope for awareness and purchase consideration for these products, with cyber insurance being an exception. The results revealed a great market opportunity for a new-age product like cyber insurance, especially in tier- 2 & 3 cities. Notably, the findings reflected that around 23% of respondents had a cyber insurance policy in place. This represents a significant proportion of cybersecurity coverage in a country like India where the penetration of fundamental products like life and health insurance is still low. Another remarkable trend observed here was that nearly 48% of respondents in tier 2 & 3 cities had bought or showed the willingness to buy insurance, as opposed to 36% in tier-1 cities. The results clearly draw a parallel between growing internet consumption in smaller cities of India and starkly similar awareness levels to safeguard that consumption.
Cyber insurance: A sizable opportunity to seize
Though still in nascent stages, cyber insurance seems to be the next big opportunity for the insurance industry, as per the survey findings. At 31% and 29%, the highest number of respondents from tier-2 and 3 cities respectively indicated the propensity to buy cyber insurance as opposed to 16% in tier-1 cities. However, out of those who had actually purchased a policy, 20% of respondents belonged to tier-1 cities, while 17% belonged to tier-2 & 3 cities. The figures represent a growing level of awareness towards effectively combatting intangible threats to crucial digital assets across India.
Aside from the potential opportunity in smaller cities, another interesting trend that emerged was the inclination towards buying family cyber protection plans. While the highest number of 45% insured customers purchased family plans, whereas 35% purchased individual and 20% were covered under corporate plans. Not only this, even among the non-purchasers, 53% showed an interest in buying family plans, which is the highest among all. This implies an apparent preference for overall comprehensive protection not just for individual cybersecurity, but also that of the entire family.
Nonetheless, it cannot be denied that there’s still a scope of coverage here. Nearly 20% of overall respondents had suffered a financial loss due to cybercrime and out of those, only 24% ended up buying the policy and 39% neither purchased nor considered buying one. Financial loss due to unauthorised transactions emerged to be the threat that most respondents (57%) wanted to cover through cyber insurance.
Mental health: A growing scope of awareness and coverage
Even though mental health conversation is shifting away from the stigma and taboo that it used to face earlier, the survey reveals that it still has a long way to go. While it is optimistic to see that 60% of the respondents were covered under health insurance which by default covers mental health, only 26% out of those insured were actually aware of this coverage. If we consider the overall survey, only 27% of the total surveyees were aware of mental health being covered under a comprehensive health insurance policy. With similar findings across all tiers, this points towards a passive coverage for mental health, rather than a proactive approach. The awareness seemed lowest at 15% for the 31-40 age group. However, one notable finding here is that 80% of those who were aware of the mental health inclusion, came to know about it after the Covid-19 pandemic.
Home insurance: Varying needs for protection across geographies
The survey projects a lower level of awareness and purchase propensity when it comes to home insurance. Only 10% of the respondents were aware that home insurance could also be purchased by tenants and not just home-owners. Out of the total surveyees, 74% did not have a home insurance policy, and merely 25% had considered buying one. Those who purchased or considered buying a policy showed a varying set of preferences for coverage. Respondents in tier 2 and 3 cities wished to protect their homes against burglary/theft the most at 39% and 44% respectively, while 34% in tier 1 cities saw damages caused by fires as the top threat they would want to cover. Protection against natural calamities was the second most important aspect for respondents pan-India.
Pet insurance: Stark contrast between consideration and purchase
The fourth segment in Policybazaar’s Insurance Awareness Day survey was pet insurance, where a stark disparity was evident between purchase consideration and actual purchase. Even though as many as 70% of the pet owners considered buying a policy, only 10% of them actually bought one. While the pet insurance penetration overall was significantly low, among the buyers, tier-2 respondents ranked the highest with 10%. The number stood at just 3% for both tier-1 & 3. Analysing the potential hazards, cover for surgery cost was seen as the most preferred aspect by 40% of respondents followed by OPD cost and death of the pet.