A recent study conducted by Tata AIA Life Insurance in partnership with NielsenIQ sheds light on the evolving financial mindset of Gen Z earners aged 21–29 across major Indian cities. Despite their digital-first lifestyles, Gen Z is surprisingly grounded in financial pragmatism, especially when it comes to life insurance.
The study found that 61% of Gen Z respondents prioritise building emergency funds, while 55% cite retirement savings as a top long-term goal. They are also focused on financial independence and planning for their future families’ needs, such as education.
“Though digitally savvy, Gen Z still trusts traditional financial tools like term insurance,” said Girish Kalra, CMO of Tata AIA. He noted that this generation is actively preparing for the future, with a strong focus on health, protection, and early retirement.
When it comes to investment behaviour, Gen Z prefers low-risk, stable instruments—such as fixed deposits, gold, and life insurance. While men lean towards stocks, mutual funds, and real estate, a notable number of women hold government bonds, indicating a more risk-averse approach.
Term insurance and savings plans are their top product preferences, fulfilling both security and long-term planning needs. Interestingly, 41% of Gen Z women see life insurance as a tool for long-term savings, while 38% of men value its investment potential. Nearly half of Gen Z is willing to spend ₹2,000 or more monthly on premiums—signaling rising aspirations and stronger financial commitment.
While one might expect them to prefer online channels, 56% of Gen Z still buy life insurance through offline methods, particularly men, who rely more on bank agents. However, women show a 50:50 split between offline and online platforms, reflecting more balanced digital engagement.
Gen Z’s financial decisions are heavily influenced by social media and influencers, especially among men. Women, on the other hand, often turn to banks and financial institutions for guidance.
Yet, barriers persist. 60% cite poor understanding of products as a deterrent. Women especially express distrust toward insurers, while men worry more about high premiums.
Ultimately, Gen Z wants insurance that is affordable, easy to understand, offers tax benefits, and includes health-focused features. For insurers, this is a clarion call to simplify communication, build trust, and offer products that reflect Gen Z’s practical yet aspirational financial goals.
