Chhattisgarh households financially at risk, says survey

Raipur, May 2 (UNI) More than 99 per cent households in Chhattisgarh cannot survive for more than one year on their current savings in case of loss of major source of household income, a survey says.

The survey, conducted by Max New York Life Insurance Company and National Council for Applied Economic Research (NCAER), revealed that majority of people had inadequate financial protection and ineffective saving habits.

Releasing the survey findings, company's Executive Director (Human Resources and Training) Rajit Mehta told newsmen here that 86 per cent households said they would not be able to survive on their savings in case of death of the chief breadwinner.

The study indicated a misplaced financial optimisim among the people with nearly 41 per cent of the households expressing confidence about their current and future stability. However, this optimism was not based on facts, the survey pointed out adding, there was a need for financial literacy for better understanding of their financial risk.

Throwing light on ineffective saving habits, Mr Mehta said nine per cent households kept their savings at home while 77 per cent simply preferred to deposit their savings in banks. Large percentage of households saving in the bank is indicative of not investing in high yield investment tools.

He said life insurance in Chhattisgarh was facing a unique paradox with high awareness and low ownership. While awareness of life insurance stood at a high 68 per cent, only nine percent of households actually owned life insurance policies.

Mr Mehta said the 'financial protection survey', which gave an unparalled view of the financial behaviour of Indian households, revealed the need to improve financial literacy and understanding of the true value of life insurance.

Based on the findings of the survey, he said Max New York Life Insurance would provide insurance solutions relevant to different customer segments in rural and urban areas as well as for women.

UNI