Zindagi ke pehle bhi

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Despite the noise around financial inclusion, the penetration of insurance in India is very poor. Calculated as the ratio of total premiums to gross domestic product or GDP in a given year, it stands at 4.2% of the country’s GDP till March 2020. Even taking into account the push the pandemic has given it, the size of the market won’t be bigger than 5.2% in 2020-21. In fact, the rate was 5.2-5.1% in 2009-10 but then dropped. In comparison, Taiwan, South Africa and the US have penetration of 17.5%, 13.7% and 12% of their GDP respectively. Among other factors, the limited array of One of the reasons for this poor penetration is the limited array of products – something as basic as term insurance was introduced in the country as late as 2009.

Fortunately following a lot of negotiations and convincing by the Indian Academy of Paediatric Surgeons, only one insurance company Star Health and Allied Insurance has come forward for insurance of unborn children against congenital illnesses. It would be a huge relief for prospective parents. Around 17 lakh children are born in this country with birth defects and it can be a boon for many. If more and more companies start offering this service, it would provide relief to many.

Young parents are burdened with the costs of a growing family. A child with congenital trouble gives them endless worries. If on top of such challenges they are burdened with the crippling costs of treatment, it would make their misery boundless. An insurance product to guard against any such eventuality can find a lot of takers in a growing economy.

Now Insurance Regulatory and Development Authority of India must approve this product. According to reports the government would help in the process of convincing the regulator of the need for such a product. It serves an important need and more and more insurance companies should come forward to offer it to the citizens. Niche and sophisticated products help a market to grow in a maturing economy.