NEW DELHI: Life insurance companies in India make no distinction between men and women when it comes to charging premiums for the vast majority of insurance products, despite studies showing that women are outliving men — and living better.

According to data available with click2insurance.com and policybazaar.com, the country’s two major insurance portals, major insurers such as Life Insurance Corp (LIC), MetLife India, Aviva Life, Sahara India Life and Tata AIG Life charge both men and women same premiums for similar ages.

LIC, for instance, charges 40-year-old male and female customers a premium of Rs 6,463 a year for a 15-year term policy of Rs 10 lakh, according to click2insurance.com, MetLife Insurance charges Rs 8,876 from 40-year-old men and women for 10-year, Rs 20 lakh policy. “If the experience doesn’t suggest a significant difference in mortality rates of men and women, the premium rates will be same,” says MetLife India Insurance MD Rajesh Relan, Metlife is not alone in adopting such an approach. Tata AIG Life too follows a similar policy, and says it is justified in view of the changing lifestyles.

“Today, the lives of men and women are no different. Therefore, there’s not much difference in the pricing of our products,” says Sitesh Prasad, vice president for accident & health at Tata AIG Life Insurance, adding, however, that his company did offer a “marginal advantage” to women based on life mortality data.

The fairer sex is not getting a fair deal despite conclusive evidence of higher life expectancy for women. Life expectancy of males in India is 63.87 years whereas females score 66.91 years, according to data available with the ministry of health and family welfare.

“A majority of women are non-smokers, which contributes to their longer life,” says SK Sethi, vice president and director of the Insurance Brokers Association of India. But while absence of distinction between men and women on premiums is the norm, some exceptions are emerging. Aviva Life says it offers women lower rates in case of its pure-protection product, Aviva Life Shield Plus, and charges less for certain unit-linked plans too.

LIC has an exclusive insurance product aimed at women — Jeevan Bharathi — and premiums charged are lower in this case than regular policies, says ED Rajesh Kandwal. However, such examples are few and some in the industry say it is also because of poor financial literacy standards. One insurance broker, who asked not be named, said companies charged both men and women equal premium because most women are unaware that once they reach the middle age, they carry lower risk and, hence, should be charged less.


Source- http://economictimes.indiatimes.com