A recent nationwide survey has revealed a sharp disconnect between insurance ownership and policy awareness among Indian policyholders, raising fresh concerns about under-insurance and financial vulnerability.
Conducted by consumer-focused InsurTech firm CoverSure, the survey covered 5,000 respondents across the metro, Tier 2, and Tier 3 cities. It found that 79% of policyholders are unsure whether their existing insurance offers adequate coverage.
The findings show that 71% of respondents own between two to five active insurance policies, with life insurance (63%) being the most commonly held, followed by health (24%) and motor insurance (13%).
Despite this, only 35% claimed to fully understand their policy terms, benefits, and exclusions. A significant 65% admitted to having limited or no understanding, exposing a critical gap in insurance literacy.
The knowledge gap extends beyond the policyholders themselves. The survey found that 60% of dependents were unaware they were covered under any insurance policy, and only 1 in 10 could accurately describe the coverage or benefits available to them.
This lack of awareness frequently leads to missed claims, rejected submissions, and underutilized policies, according to the report. Policyholders also face challenges in how they manage their insurance documents and records.
The survey revealed that 29% rely on physical files, 26% use spreadsheets, 24% track through SMS alerts, and 21% store documents in digital folders.
These fragmented and outdated systems often hamper access to critical information, especially during claims or policy renewals.
Despite clear gaps in understanding, 38% of respondents believe they need no assistance managing their insurance. Meanwhile, 36% preferred human advisors and 26% were open to digital tools.
CoverSure said this overconfidence—combined with low actual policy comprehension—signals a serious disconnect between perceived and actual insurance literacy in India.
The company stressed the need for stronger consumer education, centralized digital management tools, and advisory support to bridge this gap. Without these measures, many Indian families may remain financially vulnerable despite owning multiple insurance products.