The India health insurance market is likely to exhibit robust growth in the years to come owing to growing awareness regarding advantages offered by these policies. Increasing government focus on social sector coverage schemes and high disposable income due to rising working population are also expected to support market growth in the coming years. In addition, strong development in medical technology and better health care is likely to improve healthcare policies. Insurers are also providing coverage for people suffering from cancer, diabetes, and heart problems. People who have already suffered from these diseases are also covered in these policies. OPD was not covered in the products launched few years ago. However, companies are now introducing limited OPD covers, particularly for diagnostics, pharmacy, dental, or optical requirements.
Launch of innovative products and growth of distribution channels can have a positive impact on market growth. Effective distribution channels along with targeted publicity and promotional activities by insurers will bode well for the market. In the recent past, the industry has observed emergence of various alternative distribution channels, such as online distribution, direct selling agents, brokers, bancassurance, and corporate agents. The role of agents has evolved from prospecting and selling to advisory and service provider or financial planner. High penetration of internet has also increased the sales of medical policies in urban areas.
Improved level of customization, reduction in unit costs, better commissions, and improved services are also expected to generate higher revenue in the coming years. Insurance industry in India has witnessed remarkable growth in last decade as numerous foreign companies are showing their interest in local companies. Growing focus on rural areas of the country is also expected to support market growth. Most of the population in India lives in rural areas without suitable access to insurance products. Micro insurance is considered the most appropriate channel to achieve coverage in these areas. It also plays a key role in social and economic development. Regulatory changes, such as health insurance portability and micro coverage, are likely to open new avenues for insurers.
However, low importance of buying health insurance among young Indian population is expected to challenge market growth. Continuous efforts to encourage them to buy these policies is a major challenge in the market. Additionally, the country is referred as a savings-linked country and health insurance is believed to be payout annually. Saving-linked products is a combination of savings and insurance, which helps low-income households protect themselves against small shocks. It can also offer an incentive for more regular and longer-term savings. The concept of health insurance as a protection along with provision of getting something in return will boost market growth in future.
Some of the leading companies operating in the India health insurance market are Life Insurance Corporation of India; HDFC Standard Life Insurance Co. Ltd.; ICICI Prudential Life Insurance Co. Ltd.; Aditya Birla SunLife Insurance Co. Ltd.; and SBI Life Insurance Co. Ltd. Growth of IT sector in India is considered a key driving factor in the market. Various companies are focusing on development of e-platforms, such as PolicyBazaar.com, which includes all the aspects of the health insurance plans. It also enables consumers to understand, compare, and apply for the health coverage online.
For instance, Edelweiss Tokio Life Insurance, a joint project between the Edelweiss Financial Services Limited and Tokio Marine Holdings Inc. of Japan, launched ‘Wealth Plus’, a plan which is intended for digitally savvy customers. With this policy, additional units added to the plan throughout the premium payment term further increases the fund value. In addition, its rising Star additional benefit aid in securing child’s future. The insurer has cancelled the premium allocation and policy administration charges.
Research Support Specialist, USA