The Impact of the Third COVID-19 Wave on Life Insurance Rates

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Insurance Rates

Life insurance is an essential financial planning tool that provides financial protection to your loved ones in case of your untimely demise. However, due to the COVID-19 pandemic, the premiums for term insurance policies have increased significantly in the past year as reported in rajkotupdates.news : corona third wave affect life insurance.

The surge in premium rates by reinsurers, following the damaging second wave of COVID-19 in India during April and May 2021, led to many life insurance companies increasing their term insurance rates by 20-30%. This increase affected the margins of insurance companies, prompting them to increase their rates to offset the losses.

Reinsurers have increased their rates by approximately 30% in the past year, leading to most life insurance companies increasing their premium rates by over 20%. However, as the impact of the third wave is still being studied, life insurers are taking a cautious “wait and watch” approach before deciding on raising premium rates as reported in rajkotupdates.news : corona third wave affect life insurance

Some life insurance companies, such as HDFC Life, ICICI Prudential, and Bajaj Allianz Life, have already increased their term insurance rates, and other insurers are expected to follow suit. The reinsurer player had asked for the prices to increase by 40-50%, but insurers have only increased them by 20-30%.

The mortality rates of the third wave of COVID-19 remain in check due to vaccine penetration. Still, the wave’s impact is yet to be fully understood. Life insurers are taking a more vigilant approach toward underwriting, but IndiaFirst Life does not anticipate a further increase in premium rates in the current financial year.

It is still too early to predict the impact of the third wave, and if things go out of control, there may be a revision in the rates of term plans going forward. According to the PolicyX ‘Insurance Price Index,’ the Term Insurance Price Index Value has gone up by 4.18% in Q4, 2021.

What Can You Do?

The best way to buy insurance is to start early in life, according to Naval Goel, the Founder, and CEO of PolicyX. This is because the premiums increase as you get older, and the risk to your life is higher. It’s also important to compare prices before making a purchase, as different companies offer different prices for the same coverage. So, it’s a good idea to look online and compare the premiums of different insurance companies before making your decision.

Experts recommend buying life insurance early in life, as major price changes are reflected in the older age categories carrying higher risk. It is also essential to compare prices before buying, as different companies offer different prices.

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In conclusion, the impact of the third wave of COVID-19 on life insurance rates is yet to be fully understood. Still, it is essential to stay informed and take necessary precautions to ensure that you and your loved ones have adequate financial protection in case of any unforeseen event.

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