Working women trump men in financial preparedness for the first time, driven by rise in life insurance knowledge and security
Homemakers’ financial preparedness lags as IPQ marginally drops to 36, revealing stark contrast with working women
March 7, 2024, Gurgaon: The sixth edition of Max Life’s flagship survey, the India Protection Quotient Survey (IPQ)*, conducted in partnership with KANTAR, the world’s leading marketing data and analytics company, has revealed a notable uptick in women’s ownership of life insurance products, rising from 59% in IPQ 1.0 to an impressive 73% in IPQ 6.0. Also, for the first time, working women have surpassed men in life insurance ownership, with 79% now owning life insurance plans.
As per the survey, the financial protection levels amongst urban Indian women have surpassed the 40-point mark for the first time, increasing from 33 to 41 points over the past 6 years. However, the financial protection levels of homemakers’ have seen a marginal dip from 38 in IPQ 5.0 to 36 in IPQ 6.0, highlighting the need for bolstering their financial well-being. In contrast, the protection quotient of working women has increased from 43 in IPQ 5.0, to 47 in IPQ 6.0.
Despite a positive trend in life insurance ownership, a significant gender gap in financial preparedness persists. Urban India’s men take the lead in financial protection at 46 points, surpassing the overall average for urban India of 45 points. The financial protection gap between men and women in urban India is primarily driven by a huge disparity in life insurance awareness levels, with men boasting a Knowledge Index of 64 while women lag at 54 points. According to IPQ 6.0, women’s financial security remains at 64%, yet to recover to pre-pandemic levels of 65%, as per the IPQ 1.0 study.
IPQ 6.0 has revealed that urban India’s women demonstrate a strong commitment to safeguarding their families from life’s uncertainties, gradually closing the gap with men, whose life insurance ownership is at 76%, vs 73% for women. The erstwhile sizeable gap of 9 percentage points with men in IPQ 1.0 (68% for men vs 59% for women), is now down to only 3 percentage points.
Prashant Tripathy, CEO and Managing Director, Max Life said, “As we celebrate International Women’s Day, it is important to reflect on the financial readiness of women. The insights from the latest IPQ 6.0 survey underscore the remarkable strides women have taken in proactively securing their financial well-being through life insurance investments. However, the survey also sheds light on the enduring gender disparity in financial awareness. This requires intensive actions to empower women to assert control over their financial state. Hence, the collective call to action for the industry is to support the cohort with tailored solutions that help realize the inclusive vision of ‘Insurance for All’.”
The following findings highlight the shift in financial preparedness between urban India’s men and women, as studied by India Protection Quotient 6.0:
Working women overtake urban India’s men in terms of financial protection
With a Protection Quotient of 47 points, working women are inching ahead of men in financial preparedness, whose IPQ 6.0 stands at 46 points. While men’s life insurance ownership stands at 76%, the upward trajectory of women’s ownership at 79% signifies a shift in gender dynamics concerning financial preparedness and responsibility.
IPQ 6.0 reveals an 11-point financial protection gap between working women and homemakers
The findings of the IPQ 6.0 study reveal a concerning trend in the financial preparedness of working and homemaker women living in urban India. From a 5-point financial protection gap between the two segments in IPQ 5.0, to an 11-point disparity in the latest edition, the gap has widened. The IPQ 6.0 scores of homemaker women stand at 36 points, driven by a Knowledge Index of 47 versus 64 points for working women.
Working women lead the charge in term insurance ownership, closing the gender gap in term plan awareness
As per the IPQ 6.0 survey, 35% of working women now own a term insurance policy, as compared to 33% of men in urban India. In contrast, homemaker women trail with a term insurance ownership rate of 18%, necessitating targeted interventions to financially protect such underserved segments, as 1 in 2 homemaker women are now aware of term plans. At 74%, working women and men are equally aware about term insurance plans.
Women in urban India increasingly secure about the sufficiency of their term cover
The IPQ 6.0 findings reveal 54% of women responding positively about the sufficiency of their term cover, growing steadily from 45% as per IPQ 5.0 study. Additionally, the survey has revealed that the importance of cover has gone up from 59% in IPQ 5.0 to 62% in IPQ 6.0. Notably, only 1% of women are today unsure how much corpus they need.
Working women are more financially prudent than men, make savings and investments from their income
The IPQ data highlights a remarkable trend: working women are outpacing men in financial prudence, consistently allocating a higher portion of their income towards savings and investments. As per IPQ 6.0, urban India’s working women are setting aside 42% of their income for savings versus men who invest 41% of their income. While they are diligent savers, women are also marginally more inclined towards making more luxury expenses than men, allocating 16% of their income towards luxury spends.
Financial freedom during retirement phase: Top financial anxiety for working women
With 68% of respondents expressing worry about retirement, it is evident that retirement planning weighs heavily on the minds of women in the workforce. The IPQ 6.0 findings also reveal that working women are more anxious about sustaining lifestyle expenses at 66%, than men at 63%. Additionally, Are more concerned about income stability or job security than men, and they also focus more on saving for their children’s education and marriage than men.
Working women pay more attention to health and fitness
The study reveals that working women are more proactive in maintaining their health through various holistic practices. An impressive 62% of working women engage in activities such as meditation, yoga, and therapy, compared to 59% of men. Interestingly, women are leading the charge when it comes to adopting preventative measures for their health. They are more likely to undergo regular health check-ups, demonstrating a proactive approach to monitoring their well-being and identifying potential health issues early on.
About India Protection Quotient:
Instituted in 2019, India Protection Quotient is an annual property by Max Life Insurance in association with Kantar aimed at understanding the pulse of Indian consumers in the financial protection space. Launched with the underlying objective of increasing penetration of term insurance as the most fundamental and economical form of life insurance, the survey aims to reveal the state of urban Indians with regards to current financial security levels, changing savings and investment patterns, key anxieties, and triggers of financial protection in a contemporary world. The India Protection Quotient is a proprietary tool developed by Max Life in partnership with Kantar to gauge the degree to which Indians feel protected from future uncertainties on a scale of 0 to 100. It is based on attitudes, mental preparedness around future uncertainties, awareness, and ownership of life insurance product categories (term, endowment, and ULIP).
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