Indians increasingly protect financial goals as Waiver of Premium adoption rises 61%: Policybazaar

Indians are increasingly looking beyond simply saving and investing for long-term financial goals and focusing on protecting those goals against unforeseen disruptions, according to an analysis by Policybazaar. 

The insurance marketplace’s data on Waiver of Premium adoption shows that more customers are opting to protect the financial plans they are investing towards. Waiver of Premium allows future premiums to be waived under specified circumstances, helping keep a policy on track even if the policyholder is unable to continue paying premiums. 

Overall Waiver of Premium adoption rose from 27% in FY24-25 to 29% in FY25-26 and 46% in FY26-27 year-to-date through August. The momentum has strengthened during the current financial year, with monthly adoption rising from 32% in April to 41% in May, 43% in June, 55% in July and 61% in August. 

Retirement plans see fivefold jump in Waiver of Premium adoption 

Retirement planning has recorded one of the sharpest increases in Waiver of Premium adoption, with the share of retirement plans carrying the feature rising from 7% in FY24-25 to 37% in the current financial year. 

Policybazaar said the increase is significant given the long investment horizons associated with retirement planning. Customers are increasingly looking to protect not only their future corpus but also the financial security of their spouse and family if their ability to continue funding the plan is disrupted. 

Child-focused financial goals continue to record the highest Waiver of Premium adoption, with around 65% of such plans opting for the feature. However, Waiver of Premium adoption is increasingly extending beyond child-focused goals. Around 70% of Waiver of Premium policies sold have a nominee other than a child. Among plans with a non-child nominee, Waiver of Premium adoption has risen from 22% to 43%, indicating wider use of the feature across long-term financial goals. 

“The increase in Waiver of Premium adoption shows that customers are thinking not just about building a corpus, but also about what happens to that financial goal if the policyholder is no longer around. Waiver of Premium helps ensure that the premiums required to continue the policy are taken care of, so the goal can remain on track,” said Sameep Singh, Head of Investments at Policybazaar. 

Younger and middle-income customers drive adoption 

Younger customers are also emerging as a key segment driving Waiver of Premium adoption. Around 70% of Waiver of Premium customers are aged between 28 and 40. Among customers below 35, adoption rose from 27% in FY24-25 to 29% in FY25-26 and 47% in the current financial year. 

Adoption among customers aged 41-45 has also increased from 9% to 13% over the past three years, reflecting the growing role of Waiver of Premium in retirement-focused planning. 

Waiver of Premium adoption has risen across both genders, with adoption among male customers increasing from 30% to 48% and among female customers from 23% to 37% over the same period.  

The feature is also seeing strong adoption among lower-income customers. More than 45% of customers earning below ₹15 lakh annually opt for Waiver of Premium. The ₹5.01 lakh–₹10 lakh income segment accounts for the largest share of Waiver of Premium buyers, rising from 31% to 37%. Salaried customers account for 69% of Waiver of Premium buyers. 

The trend is also spreading beyond major metros. Tier 2 and Tier 3 cities show slightly higher adoption than Tier 1 markets, with all three segments recording growth this year. 

The South and Central regions have recorded the sharpest increases, with Waiver of Premium adoption rising from 28% to 50% in the South and from 33% to 49% in Central India. The South also accounts for the highest number of Waiver of Premium policies purchased. 

Waiver of Premium adoption is concentrated in policies with 15-20 year terms, highlighting its relevance for long-duration financial commitments. “Child-focused plans continue to see the highest adoption of Waiver of Premium. At the same time, we are seeing strong growth in retirement-focused plans, greater adoption among younger and middle-income customers, and increasing uptake across different nominee profiles,” Singh said. 

“This reflects a broader focus among customers on ensuring that the financial plans they put in place continue to deliver on their intended goals,” he added.