The reforms in the second wave are expected to increase not only the country's insurance penetration rate but also lead to a conscious shift in the insurance product mix.

A crisis comes unannounced and being prepared for it is the best prevention. However, even with a year of planning and preparations, the second wave of COVID has brought the country to its knees.

In the midst of everything, to have an added protection, getting an insurance cover has been a priority for most. Industry experts say it is important to purchase not only health insurance but also term insurance that covers the policyholder’s loved ones in the event of his/her untimely death.

Parag Raja, MD and CEO, Bharti AXA Life Insurance says, “The reforms in the second wave are expected to increase not only the country’s insurance penetration rate but also lead to a conscious shift in the insurance product mix.”

In an exclusive interview with Priyadarshini Maji, he explains how one should take care of their mental health during the pandemic, and how in times to come, Indians will have a changed outlook when it comes to protection cover.

The second wave leads to a surge in sales of COVID-19 insurance policies, will the premium prices be affected?

The reforms in the second wave are expected to increase not only the country’s insurance penetration rate but also lead to a conscious shift in the insurance product mix. The burgeoning number of casualties due to the pandemic and the co-morbidities amongst individuals has strained reinsurers that are struggling to manage their losses. To account for such losses a hike in premium by reinsurers puts a strain on life insurers as well which may affect the premium prices. In times to come, Indians will have a changed outlook when it comes to protection cover, on the positive side.

What makes term insurance unique?

When it comes to life insurance, the main goal is to have financial protection. Life insurance plans are one-of-a-kind in terms of the benefit and the sense of financial stability it offers. Term insurance is unique because of:

Coverage: In term insurance plans, one can only avail coverage against untimely death and there is no maturity benefit provided. Some term insurance plans also provide an option to return all the premiums paid at the end of the policy term on survival. However, most forms of savings or investment life insurance policies have a maturity advantage.

Premium: Only the risk of untimely death is provided for by term insurance products. This is why term plans have premiums that are incredibly low and affordable. At competitive premiums, you can purchase high sum assured covers.

Coverage duration: Term plans come with long-term durations of coverage that can go up to 67 years or 81 years in the case of Whole Life cover.

Increase in protection plan due to the second wave of covid-19- Is that the right way to go for individuals?

The ongoing pandemic has invigorated the awareness about insurance across the country especially protection. Protection plans should be an important part of one’s portfolio and should be a cardinal part of their investment product mix, as it brings real insurance benefits and builds a safety net for their families.

Protection plans provide a wide range of benefits and choices to help the customers and their loved ones fulfil their specific financial requirements at each stage of life and to empower them with adequate financial resources. Insurance players can penetrate deeper into the current industry and explore new segments in order to expand the overall protection market in India.

What type of insurance policy is the must-have to stay safeguarded from the pandemic?

It is important to protect your life by purchasing not only health insurance but also term insurance that covers your loved ones in the event of your untimely death. Furthermore, the number of patients infected with the coronavirus is growing by the day.

A term insurance policy is essentially a no-frills policy that provides maximum life coverage at the lowest possible cost. Health and term insurance should be the must-have policies during the pandemic.

What are some of the Tech trends that will transform the insurance industry in 2021?

The insurance industry is adopting digital transformation amidst Covid-19. Increased insurance penetration and an easy and hassle-free buying process has resulted in a surge in insurance enquiries and purchases online.

It is believed that the digital wave will bring about huge changes in the sector making way for new expectations in the area of information, marketing, product offerings, service delivery and claims. The aim is to provide customers with the best in class products with uncomplicated applications. Increasingly, offline processes are transitioning into the digital realm.

How should one take care of their mental health during the pandemic – advice by CEO

Social support is the key during this time. Make contact with your loved ones. Don’t keep speculating about Corona; instead, discuss other topics such as sports, science, movies and hobbies. During this time, one should also need to keep a healthy lifestyle, have regular sleep, exercise, do yoga, read, listen to music and take multiple breaks.

Make an effort to engage in creative practice. Find time to engage in hobbies you love, even if working from home is taxing. It relieves the pressure of meeting job deadlines. Exercise works as a mood stabilizer. Endorphins, which are natural pain relievers, are released during exercise. It also gives us a sense of satisfaction while keeping us physically healthy and strengthening our immune systems.

Lastly, avoid dwelling on numbers that are irrelevant to the average person. All that is required is that one should protect themselves, which entails the same old stringent measures of wearing a mask and remaining indoors and comply with all safety protocols.