NEW DELHI: As the debate over the rights, pay and social security of gig workers continues to intensify in India, industry experts and legal professionals are increasingly underscoring the need for affordable and practical insurance solutions tailored to the realities of the fast-growing gig economy.
Gig workers — who power sectors ranging from food delivery and ride-hailing to logistics, e-commerce and home services — typically operate on short-term contracts with fluctuating incomes and little job security.
In an interaction with the New Indian Express, economist and Niti Aayog member Arvind Virmani says in a country where 58% of the workers are self-employed, gig workers fall in the category between self-employed and regular employed, and therefore, it is not possible for gig workers to have all the benefits of a regular employee.
According to Bikash Choudhary, CEO of insurtech firm FatakSecure, this structural nature of gig work has historically left workers exposed to financial shocks.
“The gig workforce, largely in the 18–35 age group, operates on short-term contracts with irregular income, frequent job changes, and employment gaps,” Choudhary said. “Platforms engaging such workers were not required to provide social security benefits such as provident fund, ESI coverage, paid leave, gratuity, or insurance, leaving most gig workers without formal safety nets.”
While the government has begun addressing these gaps, Choudhary noted that existing schemes have limitations. Programmes such as Ayushman Bharat (PMJAY) provide hospitalisation cover of up to ₹5 lakh, while bank-linked schemes like PMJJBY and PMSBY offer basic life and accidental insurance. However, he pointed out that awareness remains patchy and coverage limits have not kept pace with inflation.
“Coverage limits under these schemes have remained largely unchanged for nearly a decade,” he said, adding that uneven adoption has reduced their effectiveness for a workforce that is expanding rapidly.
A key turning point is expected with the implementation of the new labour codes from November 2025. Under the Code on Social Security, 2020, gig and platform workers are formally recognised, with provisions envisaging access to benefits such as provident fund, healthcare, maternity benefits, gratuity and injury compensation.
Legal experts say this recognition is significant, though translating it into effective protection will take time. “From a legal standpoint, the availability of insurance products for gig workers may not be a challenge,” said Priti Rohira, Executive Partner at ElpeeCo, an insurance-focused law firm. “However, the structure of such coverage needs to be evaluated given income volatility and difficulties in assessing such risk.”
Rohira said the draft Code on Social Security (Central) Rules, 2025 marks an important step by proposing a legal framework that could enable “more balanced, sustainable, and accessible protection solutions” for gig and platform workers over time.
Despite regulatory progress, on-ground challenges remain. Irregular incomes, employment breaks, low awareness of insurance needs and affordability of premiums continue to hinder uptake. Choudhary argued that insurance for gig workers cannot be linked only to platforms or continuous employment and must instead be designed at an individual level.
“Products designed for this segment should focus on essential protection rather than savings, keep premiums affordable, and align with the age and income profile of gig workers,” he said. Annual policies with one-time or yearly premiums, he added, are better suited than monthly payment models, which are more vulnerable to lapses during income gaps.
Accidental cover is particularly relevant for younger gig workers, but Choudhary stressed that protection must go beyond accidental death to include hospitalisation and temporary income loss during recovery. “Affordable accidental insurance that covers these risks can prevent short-term setbacks from becoming long-term financial distress,” he said, citing low-cost annual policies as examples of emerging solutions.
The push for insurance coverage comes amid a broader and often contentious debate over gig work in India. Platform companies have argued that flexibility is central to the gig model, while worker unions and activists have highlighted issues of low pay, lack of benefits and algorithmic control. Recent public exchanges over delivery partner earnings and working conditions have further fuelled scrutiny.
As the government attempts to strike a balance between flexibility and protection, experts agree that insurance will play a critical role. “Continued collaboration between government, insurers, and ecosystem partners is essential,” Choudhary said, “to ensure that insurance becomes a dependable safety net for the gig economy rather than an afterthought.”