How Gen Z Is Changing the Insurance Game: Confident in Health, Confused About Term Plans

Table of Contents

1. Summary

2. Generational Snapshot: Gen Z vs. Millennials

3. Gen Z’s Confidence in Health Insurance

4. Term Insurance: The Knowledge Gap

5. What They’re Buying – Health vs. Term Plans

6. Investment Preferences of Gen Z

7. Early Financial Planning Among Young Adults

8. The Role of Digital Tools in Decision-Making

9. Final Thoughts

A person navigates a health insurance website on a laptop, highlighting options for insurance, accident coverage, and protection.

Summary

A nationwide survey by Policybazaar reveals a shift in how Indians—particularly Gen Z—approach insurance. While younger respondents are confident in their health insurance understanding, they lag behind in grasping term plans. This blog explores these generational contrasts, their insurance preferences, and how digital behavior is reshaping the industry.

1. Generational Snapshot: Gen Z vs. Millennials

Policybazaar’s study uncovers sharp generational differences in insurance awareness and decision-making:

Gen Z (Ages 18–28): Digital-first, confident, and early adopters.

Millennials (Ages 29+): More traditional and responsibility-driven in their choices.

2. Gen Z’s Confidence in Health Insurance

Despite their younger age, 70% of Gen Z claim they are confident in understanding health insurance. Interestingly, 32% say they are “very confident”—slightly edging out Millennials, 67% of whom expressed the same.

3. Term Insurance: The Knowledge Gap

The situation flips when it comes to term insurance:

• Only 25% of Gen Z feel “very confident” in understanding term plans.

• In contrast, 45% of Millennials express high confidence.

Experts believe this is due to life stage differences—Millennials often have families, home loans, or long-term financial responsibilities that prompt them to learn more about term cover.

4. What They’re Buying – Health vs. Term Plans

• Health Insurance Interest:

  • 61% of Gen Z are planning to buy health insurance.

  • 63% of Millennials intend to do the same.

• Term Insurance Consideration:

  • Only 19% of Gen Z are currently thinking about term insurance.

  • This is almost half compared to 35% of Millennials.

This shows that while health insurance appeals across generations, life insurance (term plans) still feels like a “later in life” product for Gen Z.

5. Investment Preferences of Gen Z

Gen Z is financially aware but selectively risk-averse. Their preferred investment options include:

• SIPs

• Stocks

• Gold

• Insurance (ranked above crypto)

Millennials still prioritize health insurance and gold equally at 14%, indicating a traditional wealth preservation mindset.

6. Early Financial Planning Among Young Adults

Gen Z is taking charge early:

• 52% believe health insurance should be bought between 18–25 years.

• 45% feel the same about term plans.

For Millennials, only:

• 22% support early health cover,

• 26% feel term insurance is suitable for those under 25.

This reflects a new maturity and proactive attitude among Gen Z toward financial protection.

7. The Role of Digital Tools in Decision-Making

Gen Z’s digital habits are influencing their insurance decisions:

• YouTube is their top research tool (46%)—explainer videos and short-form content win their attention.

• Millennials, on the other hand, prefer Google Search (40%).

Also, 23% of Gen Z are already using Generative AI tools like ChatGPT to research policies—showing a strong tilt toward tech-savvy, self-guided decision-making.

8. Final Thoughts

This data reveals a dynamic shift in India’s insurance landscape:

• Gen Z is confident, digital-first, and proactive—but still lacks clarity on long-term products like term plans.

• Millennials lean more toward responsibility-based planning and conventional research methods.

As Gen Z continues to enter the workforce and become key insurance buyers, insurers and advisors must adapt—offering transparent, visual, and tech-integrated guidance to meet them where they are.