And you thought you are selling Parle G!

A generation that can topple governments with just a hashtag, turn stock tips into viral memes, and share wellness reels all in one go, isn’t going to sit back and accept an outdated safety net. That’s Gen Z for you — realistic, tech-savvy, and financially aware enough not to fall for jargon or fear-mongering tactics. And what’s the current setup of insurance? It just doesn’t resonate with them. There seems to be a mismatch in expectation and delivery.

The insurance industry still leans heavily on outdated assumptions. Take, for instance, the belief that an employer’s group coverage is sufficient. For years, a corporate health policy worth Rs 3 lakh-Rs 5 lakh was seen as the go-to safety net. But as we approach 2026, with medical inflation sitting at around 13% and a single hospital stay in a private facility potentially draining that coverage, it’s clear that corporate plans might not be sufficient.

 And Gen Z, being financially smart, is recognizing this quickly.

 As they step into the corporate world with their work-life balance priorities in mind, they know that a corporate plan alone doesn’t meet their financial needs. They also don’t look at such plans as retention tools. While they see the growing need for individual health insurance—which is both understandable and affordable--they struggle to identify plans that cater to their evolving priorities and lifestyle.

 FIVE ‘Ws’ & ONE ‘H’…THE CHECKLIST

Surveys show rising awareness — with more than half believing the ideal age to purchase health cover is between 18 and 25 — yet actual uptake remains low. This gap highlights an opportunity for the industry to help them understand risk assessment from the policyholder’s perspective and design plans with features that align with their interests and lifestyle.

 While millennials relied on employer insurance and often picked up retail coverage later, usually around marriage or starting a family, Gen Z believes in starting early. Some surveys point out that 52% of the respondents think 18–25 is an ideal age to buy health insurance cover. The corresponding number for millennials stands at 22%! In North India, one in four working Gen Z individuals already has a term insurance. They understand that jobs can change frequently, freelancing is fast becoming the norm, and corporate insurance is complicated to port. So, instead of leaving their protection in the hands of employers, they want to take ownership.

Gen Z is making life choices that challenge the traditional assumptions that went into the structuring of standard policies. A striking 80% of young Indians have expressed that they don’t plan to have children. Many are living in non-traditional households, openly discussing their mental health needs, and seeking coverage that goes beyond just hospital stays to include therapy, support for live-in partners, and even lifestyle-related items like gadgets or pets. Policies that overlook these realities are quickly becoming outdated.

For Gen Z, digital-first access is just a starting point, and not a unique feature. They’re already turning to YouTube for research, using apps to compare options, and trying out AI-driven tools before making any financial decisions. What truly matters to them is the trustworthiness of the science behind these products. They’re eager to grasp how premiums are determined, the rationale for exclusions, and how coverage should evolve as their lives progress. While artificial intelligence can certainly improve underwriting, they want clarity on how AI affects coverage, premiums, and claims, with transparent data and logic they can rely on. Behavioural science can contribute by encouraging preventive actions, such as regular health check-ups or therapy sessions.

‘ONE SIZE’ DOESN’T FIT ALL

Employers also need to rethink their strategies. Corporate coverage can’t just be a one-size-fits-all perk or just for the purpose of retention with limited flexibility. For younger employees, it serves as a starting point rather than a safety net. To stay relevant, companies must reimagine group insurance as flexible, modular, and backed by science—incorporating wellness, portability, and preventive benefits that truly resonate with their workforce’s lifestyle.

Policy nudges, like the GST exemption on individual premiums set for 2025 may help reduce immediate costs, but it remains to be seen whether this will make a real difference but affordability isn’t the sole hurdle. The real change lies in creating scientifically backed, AI-optimized, non-pushy, Gen Z lifestyle–centred plans. Fear-mongering, ad gimmicks, and spam calls may have worked earlier, but today’s generation probes every angle in insurance to ensure they get their money’s worth.

This transformation in insurance outlook, customised by Gen Z requirements, might be the final push that boosts the embarrassing sub-4% of estimated GDP insurance penetration in India. Interests and curiosities hang by a thread, watching how the insurers navigate the GDP drop and Gen Z revolution all at one go!

(The views expressed are personal)