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Term insurance for an income generating individual, man or woman, is an instrument that can replace the earning potential in case of an unfortunate incident. But for woman subscribers of term insurance, there are certain differences in costs and disease coverage that work in their favour. The real difference is perhaps for non-working spouses through means of homemaker term insurance. Policyholders that must be under such protection net may not even be aware of such a product or the importance of such protection. We discussed the topic with Varun Agarwal, Head of Term Insurance at Policybazaar.com to shed light on the finer aspects of women term insurance.
Working women insurance
As mentioned, there are only minor differences for working woman term insurance. Cost is the primary differentiator. This is based on actuarial data that drives underwriting rather than a cost push as elaborated by Varun Agarwal. Women have higher life expectancy and so, lower chance of making a claim in the term period. Agarwal says, because of this, women’s term insurance is 15 to 20 per cent cheaper than men’s term insurance. For instance, a ₹2 crore term insurance for a male may cost ₹23,000 but only costs ₹19,000 for a woman in annual premiums who is a 35-year-old non-smoker with ₹15-20 lakh income, living in a metro.
Also, there are specific features relevant to women purchasing term insurance. Agarwal mentions that breast or ovarian cancer is covered in the female term insurance’s critical illness rider which makes an early payout on diagnosis. Also, the teleconsultation benefits will include gynaecologists and urologists, and annual checks will include a thyroid lipid profile medical check as well providing for a woman-centric policy design.
Homemaker term insurance
The contribution of homemakers, despite being intangible, is valuable and deserves as much financial protection as an earning member. The Supreme Court in a verdict stated: “The role of a homemaker is as important as that of a family member whose income is tangible.”
Homemaker term insurance policies cast a protection net for such value, and this is increasingly being offered by insurance providers.
But for the purposes of underwriting, the sum insured is pegged to the family income. Capital income derived from rentals, financial assets, dividends cannot be used as proof of income in insurance industry. This implies that to secure the financial value provided by a homemaker, the spouse’s salary slip as the proof of income or an ITR statement will be required. Agarwal also indicates that an existing term insurance policy of the earning member can be used for the purposes of homemaker term insurance.
The current providers of homemaker term insurance include leading players HDFC Life, Axis Max, Tata AIA, ICICI Pru, Bajaj Allianz and PNB Metlife. The sum insured though is restricted to ₹1 crore at the upper end even if the spouse’s salary is more than ₹15 lakh. These covers cost an annual premium of ₹12,000 to ₹14,000.
Joint or individual
There exist policies which will cover the husband and wife. But, as pointed out by the industry expert, term policies should be bought on an individual basis where possible, and not on a joint basis. Joint basis is where the earning spouse’s term insurance includes a cover for the homemaker. An individual insurance would allow each member to maximise their coverage unlike a joint policy which limits the homemaker cover to ₹1 crore as mentioned. Even though each member would be protected by their own term plan (triggered on individual events) in joint covers, working women should consider an individual policy unlinked to their spouse for maximum coverage.
Published on May 24, 2025
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