From specialised packages to lifelong cashless cover, more and more Indians are buying health insurance products.
In 2015-16, health insurance companies collected Rs 24,448 crore in premium according to figures compiled by the Insurance Regulatory and Development Authority of India (IRDAI) — 21.7 per cent higher than the year before. This is the highest year-on-year growth in premium in the last five years, and the first time that the growth rate has gone upward during this period (see graph).
Low penetration of health insurance has always been a concern in India given that the government sectors struggles with a huge patient load and the private sector is largely unregulated and often exorbitantly priced. In 2015-16, the number of Indians covered by health insurance was 35.90 crore (out of an estimated population of 125 crore) according to IRDAI statistics, up 24 per cent from the previous year’s 28.80 crore.
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These figures include the number of people covered under the Rashtriya Swasthya Bima Yojana (RSBY) — a scheme originally targeted at migrant workers and managed by the labour ministry and recently transferred to the health ministry in preparation for the National Health Protection Scheme (NHPS) announced in the 2016-17 budget.
RSBY is currently running in 398 districts in 19 states with 4.13 crore enrolled families, with the premium paid by the state varying between Rs 745 per family in Mizoram and Rs 191 in Karnataka. NHPS, which found mention in the PM’s Independence Day speech this year, will provide a cover of Rs 1 lakh to every target family.
“Health insurance continues to be the fastest growing segment… The industry grew by 21 per cent in FY 2015-16 and by 2020, it is expected to exceed Rs 50,000 crore with standalone health insurance companies growing faster than market. With thrust on innovation, wellness and customer centricity, the new health regulations offer numerous opportunities and will propel the industry forward…,” said Ashish Mehrotra, MD and CEO Max Bupa Health Insurance.
Statistics of Apollo Munich show there has been an increase in the number of people opting for sum-insured policies in the range of Rs 5 lakh and above this past year, said CEO Anthony Jacob. “We have been clocking a steady growth path for the past five years and believe that we are in the business of paying claims. Hence our insurance payouts have also grown at a CAGR [compound annual growth rate] of 12 per cent in the last five years. Also, we have seen a steady 55:45 payout ratio of reimbursement of claims versus cashless claims at Apollo Munich. We expect this trend to change in the coming year, as a result of demonetisation and re-monetisation efforts of the government,” he added.
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