Children’s Day 2025: Build a secure tomorrow with the right insurance for your child

Children’s Day is a celebration of joy, potential, and innocence. But beyond the festivity, it also offers us a moment to pause and reflect, are we building a secure enough world for our children to thrive in? In a nation where more than a quarter of the population is under 14 years of age, the future is undeniably young. Yet, this demographic strength must be matched with robust financial preparedness to truly realise its promise.

India’s economic landscape is evolving rapidly. The country’s total health expenditure has more than doubled in just four years, from approximately ₹3.2 lakh crore in 2020–21 to ₹6.1 lakh crore in 2024–25. However, despite this increase, families continue to shoulder a significant burden. Out-of-pocket expenditure as a share of total health spending still stands at around 39.4%, according to the National Health Accounts data released in 2024. A single medical emergency can derail years of savings, forcing many families to compromise on education or essential needs, the very foundations that shape a child’s future.

Education, meanwhile, is becoming a costlier aspiration. With education inflation in India hovering around 10–12% annually, the expenses associated with higher learning are doubling every eight to ten years. A four-year degree that costs ₹10 lakh today may require as much as ₹20–22 lakh by 2035. When juxtaposed with rising living costs and uncertain economic cycles, the need for families to prioritise financial protection over discretionary spending becomes even more urgent.

Yet, India’s general insurance penetration remains among the lowest in emerging economies. The Insurance Regulatory and Development Authority of India (IRDAI) data shows overall penetration at 3.7% of GDP, with non-life coverage at just 1%. This indicates a significant protection gap, one that leaves millions of families, and by extension their children, financially vulnerable. Despite increasing awareness and the presence of innovative products, a sizeable portion of Indian households still view insurance as optional rather than foundational.

When a family is financially protected, its children are emotionally secure. A family floater health plan can ensure uninterrupted access to quality healthcare, while a term or income-protection policy safeguards a child’s education and living standards if an earning member is affected by unforeseen circumstances. Similarly, home insurance, taken by less than 1% of Indian households, protects not just physical property but the stability of family life. These are not just financial instruments; they are enablers of continuity.

The onus, however, does not rest solely on families. The insurance industry has a critical role to play in making protection accessible, affordable, and relevant to India’s diverse demographics. Simplified products, easy digital onboarding, and customised solutions for families with young children can bridge the existing coverage gap. As India inches closer to becoming a $5-trillion economy, inclusive growth must go hand in hand with inclusive protection.

Children’s Day, therefore, is not only a reminder to celebrate childhood but also to protect it. Love and encouragement nurture dreams, but preparedness ensures they are not cut short by uncertainty. A truly secure tomorrow for our children will be built not just with ambition, but with action, through every policy, every plan, and every decision that fortifies the foundation on which they stand.

(Views are personal; the author is CEO at Reliance General Insurance)