Only 14% of the population in India has some form of Health Insurance and almost 75% of medical spending is out-of-pocket. It is not only in India where insurance is considered as a sell product. The latest Obamacare ad focuses on young adults to sign up for health insurance.
The difference is that the awareness levels are much higher in the western world and it is also more about affordability. Most of the people in India still consider health cover of no use and a waste of money. They don't see any point in purchasing health insurance. As our country is severely under insured, there is huge potential for deeper penetration of this segment.
The government has also taken this segment seriously by introducing Rashtriya Swasthya Bima Yojana (RSBY) which is a milestone and its coverage is still expanding. Through RSBY, government has provided health insurance smart card to below poverty line (BPL) workers and their families.
By 2020, universal health coverage for at least 80% of the population will emerge as a key government priority.
Not only poor, even an average middle class family can also get a hole in the pocket because of skyrocketing healthcare costs. Rising healthcare costs is one of the factors that have helped accelerating the pace of health insurance industry in the past few years. However, products and distribution were more focussed till now. There is a need to put more efforts at the industry level to enhance awareness.
With an aim to simplify the complexities in the documentation for customer's better understanding, the health insurance industry in 2013 witnessed transformation of implementing standardization guidelines. According to the CEO of Max Bupa health insurance, Manasije Mishra, insurers will get help from product innovation and focus on quality of service in 2014 which will strengthen their reputation and growth as a business. He also added that the IRDA regulatory sentiments are in the best interests of the industry and customers so it's an exciting time to be in the health insurance industry. The industry in the last few years has headed towards a positive change but still there is a lot to be achieved yet.
Following are the companies and their initiatives to change the scenario in the next few years:
Apollo Munich Health Insurance: According to the CEO of the company, Antony Jacob, a cashless card will be introduced for a hassle free 'walk-in walk-out' claim experience. Lifestyle diseases have been associated with metropolitan cities in the past but now this has changed. There is a need to work towards a far more automated system which has minimum human intervention. A far more efficient and transparent system can take decision on a real time basis. So, the company needs to work towards it on the service delivery standards. The aim of the company is to create a system which will enable customers to use the cashless card as any other debit or credit card.
ICICI Lombard: Bhargav Dasgupta, MD and CEO of the company said that they are going to adapt more proactive approach instead of being mere health risk financiers. The company is going to introduce health management services like knowledge dissemination tools, wellness solutions, etc. According to Bhargav Dasgupta, insurers need to introduce specific OPD policies thus aligning their offerings to the needs of the customers. Instead of merely financing the repair expenses on case of motor insurance, the company is planning to take the responsibility of ensuring quality repair of the damaged vehicle by tie-ups with service stations.
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SBI General Insurance: According to the MD and CEO of the company, Bhaskar Jyoti Sharma, the main focus is on in-patient coverage. The company will soon introduce a whole range of new coverage ranging from wellness programmes, outpatient cover, disease specific covers, expansion in number of day care procedures, etc. There would be greater receptivity to medical outcomes and standardised treatment guidelines owing to major cost implications.
Bharti AXA General Insurance: The MD and CEO of the company. Amarnath Ananthanarayanan said that they are focusing mainly on giving a wider choice to the customers. Product and service differentiation would be the pillars for the company growth as well. It will boost the penetration. Accessibility and reach of insurance to the underinsured segments and Tier ll & Tier lll cities will be more widespread with the advent of the digital age and online purchase of insurance.
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