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Only 12-13% of workforce under pension cover

PFRDA chairman said only 12-13% of the workforce is covered under pensions.

The reach has percolated mostly to the organised sector, which is backed by statutory benefits, and the challenge lies in taking these products to the unorganised sector.

Pension Fund Regulatory and Development Authority (PFRDA) chairman Hemant G Contractor said only 12-13% of the workforce is covered under pensions. This reach has percolated mostly to the organised sector, which is backed by statutory benefits, and the challenge lies in taking these products to the unorganised sector.

According to Contractor, the draft labour code, currently in the pipeline, could be a breakthrough in the economic history of India.

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He said a large section of the population does not have access to such products, resulting in less penetration. Only 12-13% of the workforce is covered under pensions. The health cover stands at 27% and the life cover is at a comparatively low rate, Contractor said.

The government has taken initiatives in this regard through schemes such as Ayushman Bharat and the Atal Pension Yojana to meet the gap in demand, he said. Contractor was speaking at the 20th Annual CD Deshmukh Memorial Seminar, organised at the National Insurance Academy in Pune.

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The benchmark for a country’s development cannot just be measured through the GDP, but on a holistic metric comprising health, wealth and most importantly, happiness. These depend on providing individuals with effective mechanisms to protect them from economic risks, he said. This can be achieved through insurance and financial products.

Nilesh Sathe, member (life), Irdai, said the life expectancy has risen in the country, but the lack of long-term products could pose a challenge for the same. New challenges such as the phenomenon of double-income-no-kids families and the climate change are emerging, Sathe said.

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