Term insurance getting popular among working Gen Z: Tata AIA Life Insurance report

Term Insurance is popular among India's working Generation Z, with 31% of respondents planning to purchase it, the highest percentage among all available life insurance categories, according to a study conducted by Tata AIA Life Insurance in partnership with NielsenIQ.

Despite being digital natives, India's working Gen Z is emerging as a surprisingly pragmatic generation, especially in terms of financial protection and a strong desire for long-term security. This generation is also prioritizing the conversation around retirement, with a growing interest in the F.I.R.E. (Financial Independence, Retire Early) movement.

Many are finding a balance between current needs and a long-term view, with 18% already considering retirement and pension plans, marking a notable shift from the more passive approach seen in previous generations.

The study surveyed employed individuals from Generation Z aged 21-28 in eight major cities (Delhi, Mumbai, Bangalore, Kolkata, Hyderabad, Pune, Jaipur, and Patna). The sample was evenly split between metro and non-metro areas, with equal numbers of male and female respondents and an average age of 25.

Other findings showed that 60% of respondents prioritize physical health benefits when selecting a life insurance provider. Additionally, 65% of male Gen Z individuals place more emphasis on wellness benefits compared to 54% of female Gen Z individuals. Despite their preference for online activities, financial trust remains important, as 53% still rely on agents or bank advisors for insurance purchases, while the rest use online or other methods. Furthermore, 25% seek financial advice on social media, indicating the increasing influence of digital creators and content.

Also, one in four individuals prefer a combination of term insurance and wealth accumulation, which offers both protection and savings. It is noteworthy that 57% of Generation Z customers looking to purchase insurance are willing to invest more than Rs 2,000 per month, displaying a stronger intent compared to current policyholders in this age group.
 
Girish J Kalra, Chief Marketing Officer, Tata AIA Life Insurance, said: “The research underscores some vital insights: while Gen Z is highly digital, they continue to rely on time-tested financial solutions such as term insurance for long-term security. With a focus on financial protection, health and wellness, and early retirement planning, Gen Zs are actively preparing for their future.”