Ideally Speaking, Health Insurance Should be Available to Citizens, Even the Aged!

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Health Insurance
  • As you are aware, the health insurance sector is one of the most consistently thriving industries that has established an unparalleled presence in the Indian context. In the absence of adequate public healthcare support for hundreds of millions of citizens languishing at the lower strata, reaching out to healthcare facilities poses tremendous challenges. Despite the government authorities introducing various healthcare schemes aimed at reaching out to common citizens, the penetration of the same is far from satisfactory. Note that health insurance plays a defining role in providing succor to common citizens but unaffordability in the form of high premiums or restrictions to extend the facility to aged citizens mars the well-intentioned schemes.

Health Insurance

PC: The Economic Times

  • Little wonder that the private health insurance sector is thriving in the absence of robust public healthcare amenities for those common citizens. For the uninitiated, the Indian insurance sector has two distinct entities in the form of life and non-life insurers. In simple words, it is life insurance and health insurance, respectively. Voices are being raised about tweaking the Indian insurance regulations to dismantle the wall between life and non-life insurers. If that happens, LIC, the market leader in life insurance, will consider getting into health insurance. Mind you, it’s well placed to do so, with an annual profit of over Rs. 40,000cr and its share price having almost doubled since October 2023. The big question is, what will this mean for consumers?
  • Notably, health insurance is highly competitive. At end-2023, there were 29 insurers underwriting health policies, the largest segment of the non-life market. It’s also fast-growing. Health insurance premiums, in 2013 expanded by 21%, which was seven percentage points faster than the overall growth in non-life segments. The numbers are at odds with consumer experience. A survey by insurance broker Policybazaar shows that while 96% of the sample was aware of health insurance, only 43% owned a policy. Two of the three most important reasons for insubstantial ownership were a feeling that premiums are too high and that policies are complex in terms of ailments excluded from coverage etc. Let’s look at what the statistics reveal here.

IRDA

PC: Economic Times

  • Indeed, India’s health coverage is dominated by govt sponsorship, but the premium is raised overwhelmingly from private policies. Insurance regulator IRDAI’s data showed that 550 million people have health coverage. About 54 of every 100 covers are govt-sponsored. But Rs.91 of every Rs.100 collected as premiums came from individual and group policies. A mere 6% of the population with individual health coverage are senior citizens even though IRDAI encourages their coverage. The most vulnerable group is excluded mainly because the hike in premium is particularly steep for that demographic. A new entrant needs to figure out how to fill the large gap in India’s health coverage. The LIC can be perfectly fitted as the insurer. Hopefully, it will fructify.

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Krishna MV
Krishna is a Post Graduate with specialization in English Literature and Human Resource Management, respectively. Having served the Indian Air Force with distinction for 16 years, Armed Forces background definitely played a very major role in shaping as to who & what he is right now. Presently, he is employed as The Administrator of a well known educational institute in Bangalore. He is passionate about sharing thoughts by writing articles on the current affairs / topics with insightful dissection and offering counter / alternate views thrown in for good measure. Also, passionate about Cricket, Music – especially vintage Kannada & Hindi film songs, reading – non-fictional & Self-Help Books, and of course, fitness without compromising on the culinary pleasures.