According to data from Policybazaar, nearly 75% of health insurance customers now compare at least three plans before purchasing a policy. Those who compare extensively end up paying, on average, around 20% lower premiums than those who choose the first available option. The trend reflects a broader shift where buyers are increasingly evaluating what they receive in return for the amount they pay, moving beyond just finding the cheapest premium.
The analysis reveals significant premium differences across insurers for similar customer profiles. For a ₹10 lakh family floater policy for a young family of three in Delhi, premiums range from ₹773 to ₹2,426 per month. For a 62-year-old couple with pre-existing medical conditions, premiums vary from ₹2,423 to ₹5,562 per month. Younger buyers generally compare policies mainly to reduce premiums, while existing policyholders focus more on features such as hospital networks, room rent eligibility, deductibles, co-payment clauses and claims experience before renewing or switching plans.
In term insurance, price differences are substantial with more than 40% of buyers now comparing at least three policies, compared with 32% in 2023. For a 30-year-old salaried non-smoker seeking ₹1 crore life cover, monthly premiums can range from about ₹635 to ₹958. For a 35-year-old married parent purchasing ₹2 crore cover, premiums can vary by more than 60% across insurers. Interestingly, many buyers increase their sum assured after comparing plans because they discover that a higher level of protection often requires only a modest increase in premium.
Comparison is significantly impacting the motor insurance market, with buyers saving ₹8,000 on older vehicles and as much as ₹30,000 on newer vehicles. Customers who compare several plans generally pay premiums that are 15-20% lower than those who do not. Premiums vary due to insurers differing in pricing, insured declared value, available add-ons and claims-related benefits. The report notes that customers are willing to pay extra for features such as Zero Depreciation, Engine Cover and Invoice Cover, while add-ons such as roadside assistance are more commonly dropped to reduce premiums.
The study highlights a broader shift in consumer behaviour driven by digital platforms. First-time buyers generally focus on keeping premiums low, while repeat customers place greater emphasis on coverage quality and insurer credibility. Buyers in Tier-II and Tier-III cities are also spending more time comparing policies before making a decision. According to Sarbvir Singh, joint group chief executive officer of PB Fintech, wider access to information through digital comparison is reducing the information gap between insurers and customers, with insurers under greater pressure to offer competitive pricing and products that better match customer needs.
