7 Health Insurance Industry Trends

1. New IRDA Regulations

IRDA keeps issuing new regulations so as to keep the insurance industry focused on public interest rather than blindly making profits. The key regulations issued by IRDA for the year 2019 are going to be crucial and will lead to redesigning of the products, not only those being planned to offer in the future but also which are already being sold in the market. Some of the new regulations for the year 2019 are as follows.

• The insurer will be liable to pay a minimum of 50% of the cost incurred on pre-insurance medical check-up
• Lifelong renewability is going to be a mandatory feature in all health insurance policies
• Customer information has to be summarized in one page so that to enable him to get through the key benefits and exclusions of a plan easily
• NCB will no more go down to zero even after a claim. Earlier, the earnestly earned NCB would fall to zero even in case of a nominal claim.
• The insured will no more be obliged to incur the loading charge for getting his/her policy renewed (even if he/she makes a claim in the policy term)

2. Big Data

The introduction of Big Data in the insurance sector has huge potential to increase competitive advancement which makes insurance providers more successful. As per a survey in 2013, the increased digital interactions with the customers aided in the capture and manage a large quantity of data about them. As insurers collect more rough data about insurance seekers, IRDA needs greater insight into what data is available to the industry, how it is being used, and whether it should be used by insurers. The use of Big Data aids the insurers in underwriting, marketing, rating and claim settlement. However, the regulator may face a challenge to inspect whether it is beneficial or harmful to the insurance users.

3. Cloud Technology

When Cloud Technology has transformed many industries, the insurance sector is no exception. The industry recognises its significance as it is the most cost-effective way for an insurance company, its customers and brokers. While money is a major driving factor, through cloud computing the industry can save a huge amount of money by investing it in a better training programme or better insurance policies. One of the most important aspects IT will be managed by Cloud. It can be managed by upgrading storage and RAM, managing equipment, deploying, anti-virus, updating software applications etc. It also allows the industry to integrate risk management, risk assessment while protecting it against data breaches or data theft.

4. Online Sales Channel

Insurance was once perceived as the most misselling product, courtesy of dishonest insurance agents. But with the advent of online platforms, there has been a steep decrease in the selling of insurance policies through agents, followed by busting of that perception. In 2013, agents are going to lose a bit more ground to the online comparison portals, which not only saves time, money and effort of the customer but also makes the whole insurance buying thing more transparent than ever.

5. Blockchain

Blockchain Technology has gained huge popularity in the past several years. The technology is famous for solving security-related data exchange. And the industry like insurance sector where customer security is the foremost aspect to be considered, Blockchain provides faster access to the big amount of data from the customers. It helps in reducing the administrative cost via automated verification of claims/payments from the third parties. Now insurers can easily view the past claim transactions on Blockchain. This way Blockchain is disrupting the insurance sector for better by providing complete transparency, accountability and superior security, while helps the insurers in saving money and time and improving customer satisfaction.

6. Adoption of Global Strategies

With all those foreign joint ventures and collaborations, the Indian insurance industry is likely to keep inculcating global expertise and international strategies leading to an overall increase in efficiency and effectivity of the whole insurance sector. The claim process is likely to become faster and more streamlined and the document submission is expected to go online.

7. Increased Penetrability

The healthcare industry in India is evolving fast. The third largest fraction of workforce in India works for the healthcare industry. There has been a continuous rise in the number of participating medical and paramedical professionals in the healthcare network, making health insurance more penetrable at ground levels. This is further bolstered by govt. driven awareness programs at rural levels, rising healthcare costs, more awareness among people for health insurance and better healthcare infrastructure. It's a two-way process, the overall improvement in the health insurance sector is increasing insurance penetrability and increased penetrability, in turn, is inspiring further improvement.

Other than the aforementioned health insurance industry trends, there are some more to add to it. They are discussed below:

• Integrated Approach: The insurance sector is driven by various forces, competitors, workforce, regulating authority, customers, and healthcare network and professionals. At present, overall health insurance domain is going through a rapid transition. The key players are adopting a 360-degree approach to maximize customer acquisition. Not only they are constantly expanding their web of network hospitals, clinics and speciality care centres, but also offering value-added services on their plans such as maternity coverage, day care expenses, lifelong renewability, 24x7 doctors’ helpline and regular health checkups. Other insurers have gone a step further and tried to offer products that integrate the features of both preventive health care plan and health insurance.
• Specialized Insurance: As of yet, health insurance has worked quite well for the general population. But when it comes to serving people with a pre-existing condition, no insurer in India (with the possible exception of Star Health) has come forward and taken the responsibility to serve the niche. This is better known from the fact that health insurance cover for HIV patients, cancer patients and diabetic patients are so few that they can be counted on fingers. Even old aged are either plainly denied coverage or end up paying high premiums for getting a decent cover. Hopefully, with the intervention of IRDA, the things are going to improve in the near future.
• Employer-Sponsored Wellness Programs: As a legal obligation, employers are supposed to give cover to their employees under a group health insurance plan. But as the health care costs continue to rise drastically, the corporations are rethinking on how to save the money. One way most of them have come up is to penalize unhealthy individuals like smokers and alcoholics and rewarding those who participate in healthy habits like joining a fitness club and taking up regular exercises. In a literal sense, companies are increasingly getting involved in organizing wellness programs and inspiring employees to adopt a healthy lifestyle.

Health insurance in India is poised to achieve its best in the year 2019 in terms of revenue as well as penetrability. The factors mentioned above will be significant in a good way bringing about the expected growth.

Recent Developments:

Apart from the above trends, some of the recent developments that influence the growth of the industry are:

• The leading e0commerce brand Flipkart joined hands with Bajaj Allianz to provide the customers with mobile insurance facility in October 2018
• In August 2018, a group of WestBridge Capital, investor Mr Rakesh Jhunjunwala made an announcement to acquire India’s one of the largest health insurers Star Health and Allied Insurance at around USD 1 billion.
• HDFC Ergo launched ‘E@Secure’ cyber insurance policy for individuals in September 2018

Health Insurance: The Road Ahead!

The Indian healthcare industry is one of the fastest growing sectors; hence, the government is making serious efforts to ensure quality healthcare services to all. The insurance providers contribute a lot by introducing innovative products with advanced features and promote health insurance awareness. Nowadays, one can secure the entire family under a single plan at an affordable premium. The insurance industry in India is expected to reach a growth of US$ 280 billion in 2020. The recent development under scheme Ayshman Bharat launched in 2018 ensures coverage of Rs. 5,00,000 to more than 100 million economically deprived families. Moreover, some of the demographic factors such as young insurable pollution, growing awareness of healthcare rise of middle class, and awareness of retirement planning will aid in subtle growth of Indian health insurance sector. With this, the future of health insurance looks promising.