Insurance for the low-income group: Vector-borne diseases are fast becoming fatal among the low-income group section of the society. People with the high-income group can avail mediclaim facility but what about the low-income group people who can't afford to invest a high premium and ensure the safety of their family. To address the woes of such section insurance companies have started to come with tailor-made insurance schemes. These schemes cover diseases like Dengue and other vector-borne diseases that kill mainly the poor or low-income group people.

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Speaking on the issue CS Sudheer, CEO and Founder of IndianMoney.com said, "Insurers are targeting millennials and people with low income by offering micro cover for risks. Tailor-made insurance schemes protect you from vector-borne diseases, accidents for a specific travel period or even motor insurance based on how the vehicle is utilized.  Millennials understand financial liabilities and know the extent of cover they need. Insurers have launched a number of tailor-made insurance schemes to cater to this rising class of customers."

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Sudheer of IndianMoney listed out the following five benefits that a tailor-made insurance scheme provides:

1] Microinsurance for the poor and vulnerable in India

Microinsurance is vital to India’s plans of financial inclusion. It has the potential to improve insurance penetration in India, which stood at a mere 3.69 per cent in FY 2017-18. The insurance sector has the potential to touch $280 Billion by 2020. 

Benefit: Microfinance deals with general and life insurance plans with a sum assured of Rs 50,000 or less. It offers financial protection to the low-income families in India, for whom the death of the breadwinner is a financial catastrophe. 

With more than 80 per cent of India’s population residing in rural areas, micro-insurance makes an insurance plan very affordable. Insurers use automation, elimination of documents and high volumes to keep costs low.

2] Sachet insurance at low premiums

Sachet insurance also called bite-sized insurance comes with low premiums and low cover. It focuses on a specific need.  The insurance you get with the train ticket on the IRCTC website is a typical case of bite-sized insurance. Insurers are building bite-sized insurance products for the life and general categories. The focus is on health, travel and lifestyle needs. Sachet insurance targets a particular risk, making it a starting point for first-time buyers.
 
Benefit: Bite-sized insurance offers cover against a specific risk. A small ticket-size health insurance plan offers specific health cover for a short duration. Health insurance plans which cover vector-borne diseases like dengue and malaria are an example. 

3] Tailor-made insurance for all needs

Tailor-made insurance focuses on covering risks which most insurance plans ignore. You could avail diverse covers like designer clothes, wedding dress, musical instrument, helmet, CCTV and even mobile screen insurance. 

Benefit: Tailor-made insurance focuses on meeting even the smallest of risks with an insurance plan. Tailor-made insurance offers need-based cover and can increase insurance penetration in India. 

4] Tailor-made group health insurance plans

Groups of people, who assemble with a commonality of purpose or engage in common economic activity, may avail collective covers. Employer-employee groups, social and cultural associations, housing societies, alumni and even savings bank account holders enjoy this cover. 

Benefit: As many members are covered, premiums could be lower than individual plans. Tailor-made group insurance plans, waive the waiting period for pre-existing diseases, cover senior citizens and even offer maternity and newborn baby cover. Premiums are low, owing to higher negotiation power of the group. 

5] Tailor-made term insurance plans

Tailor-made term insurance plans are offered under the ‘affinity’ group cover. Members who have commonality other than employment can be part of the affinity group. It’s difficult for self-employed people with low salaries and no formal income proof to get term insurance. These people need term life plans but are slotted in the high-risk category.  

Benefit: Tailor-made insurance plans cover the affinity group, but premiums may be higher due to the customer profile.