How much does Insurance Cost In India per Month?

If you are an Indian, there is a very high probability that you have some form of insurance. Whether it is a general insurance, travel insurance, property insurance, health insurance, or vehicle insurance, you most likely have at least one of them. Private insurers offer various policies under the life or non-life category.

If you are looking for insurance and don’t know what to expect, this article will provide a guide on the different types of insurance policies available in India and their average cost in the nation.

1. Health Insurance Policy

The cost of healthcare is rising day by day. It has become very expensive for an individual to pay the expenses associated with a serious illness or injury. The real relief, in this case, is to have a health insurance policy in place. Health insurance coverage, often known as a medical insurance plan, is an agreement between an insurance provider and an insured in which the insurance company assists the policyholder in meeting medical expenditures. A medical insurance plan offers the advantage of repayment of healthcare bills or cashless care for a disease or injury.

Average Insurance Cost in India: 500-800 INR /month but it depends on the “type” of health insurance plan that you take. This is only for an estimate and can vary based on your coverage, sum insured, type, add-ons, benefits, etc.

For example, a 30-year-old couple, opting for a health insurance coverage of INR 5 lakhs, will have to pay a premium of INR 10,000-INR 11,000 approximately, i.e. INR 833-916 on a monthly basis.

2. Term Life Insurance Policy

Term insurance coverage is a form of life insurance plan that offers coverage for a set number of years, or “term.” A death payout will be provided if the policyholder dies during the time frame stated in the plan. The duration of coverage might range from 1-30 years; however, it is subject to change depending on the insurance provider. Term insurance plans are often less expensive than whole life insurance policies since they provide coverage for a shorter period of time and have a different premium payment system than permanent plans.

Average Insurance Cost in India: 500-1000 INR /month but it depends on your age and your coverage. If you choose a lesser coverage, you pay a lesser premium. If you opt for a plan early in life you pay a lesser premium. However, if you opt for a monthly premium, your effective premium would be higher than annualised premium.

For example, a 30-year-old man, non-smoker and salaried, opting for a term insurance coverage of INR 1 CR will have to pay a premium of INR 10,000-INR 12,000 approximately, i.e. INR 833-1000 on a monthly basis.

3. Motor Insurance Policy

Driving a vehicle on city roads is an absolute delight! You can go to the market, buy groceries or visit your friend who lives in the next neighbourhood. But, it’s not always like that. Sometimes, you might be speeding and get into an accident or you might even run over somebody else’s vehicle. A comprehensive car insurance policy not only provides cover for such liabilities but also covers your vehicle against theft and burglary and damage caused by fire and natural disasters, such as hail storms and earthquakes.

Average Insurance Cost in India: It totally depends on your vehicle and the type of insurance plan that you take.

For example, the cost of comprehensively insuring a 5-year-old Maruti Alto of about INR 1.3 lakhs IDV with 50% NCB comes to about INR 4000-5000. However, for a Kia Seltos with IDV of INR 6 lakhs+ with say 25% NCB comes to about INR 8000-10,000 depending on the additional benefits chosen. For premium cars, the insurance value increases further.

If you opt for the third party car insurance plan only, which is mandated by the Government of India, then your premium cost would be much lesser.

The cost of insuring a bike is much lesser. A 5-year-old Bajaj Avenger with IDV of INR 26145 and 45% NCB comes to annually INR 1600-1700.

4. Travel Insurance Policy

Travel insurance is essential for those who love to travel. In fact, millions of people do it around the world every year, whether it’s for a short vacation or a long one.

Travel insurance is a type of insurance policy, specifically designed to protect clients who travel, including those on trips outside their home country. Like most other forms of insurance, the purpose of having travel insurance is to protect all stakeholders against catastrophic financial losses that could otherwise devastate them financially. This is largely due to the fact that billions of people take vacations around the world and it’s upsetting due to the spread of COVID-19.

Average Insurance Cost in India: Travel Insurance costs depend on whether you are opting for travel within Asia or to the US/Canada or the Schengen countries, as the cost of emergency hospitalisation varies significantly. Also, annual or multi-trip plans are more cost-effective than single trip plans. Usually travel insurance plans are offered as a bundled product along with tickets, visas or other associated expenses. Local travel plans within India are even more cost-effective.

For example, a 6 day trip within Asia for a couple less than 50 years of age will have to pay a premium of INR 900 to INR 3000 based on their sum insured of $25,000 to $5,00,000.

5. Group Insurance Policy

Group Insurance health programs cover a number of people who are generally firm workers or staff of an organization. Because the insurance company’s risk is dispersed among a bunch of policyholders, group health customers typically obtain insurance at a lower premium rate.

The major benefit of a group policy is that it distributes risk among a group of covered people. This helps members of the group by lowering rates, and insurance providers can effectively manage risks when they know who they are insuring. Health maintenance organizations deliver care to policyholders, allowing insurance providers to impose even more cost control.

Average Insurance Cost in India: There is no fixed average cost as the premium for group insurance can be varied, based on the coverage type, the number of individuals in the group, their respective age groups and the salaries, etc. Also, group insurance plans are customised to suit the specific needs of that particular group and hence cannot be provided off the shelf.

Conclusion

There are few things in the world that are worse than realizing you’re in serious trouble, only to discover it’s too late to do anything about it. That’s why it’s important to have proper insurance coverage in place, so you can feel safe knowing that, should the worst happen, there will be financial support waiting for you.

Insurance is indeed becoming more important for the people living in India to protect their resources and income against financial uncertainties. There are numerous insurance products available to consumers, but you should take a significant amount of time to compare between different policies to find out which one is best for you.