According to the India Brand Equity Foundation (IBEF), there is a substantial growth among insurance takers, courtesy distribution channels, and innovative products. Covid19 has driven a 41% increase in medical insurance companies among the non-life insurance sector.
As people become familiar with medical emergencies and their financial burdens, health insurance has come into the picture. Having a medical insurance policy is now a necessity for every individual. Apart from providing risk coverage against expenditure caused by medical ailments, there are other reasons why Medical insurance is necessary.
In FY21, over 500 million people got health insurance coverage in India. Most of them got coverage under government insurance schemes. The remaining got coverage under corporate insurance schemes, which gets over once the employee leaves their company. Effectively, the penetration of medical insurance remained at 35% of the total population.
Apart from the low penetration, over 70% of individuals in India spend their entire income on medical bills. According to WHO, 31% of the urban population finances their hospitalization by loans or by selling personal assets. People are not aware of the benefits of health insurance or how they are supposed to get one.
Insurance providers give options for various types of medical insurance policies. One can look for maximum benefits to get expenses coverage for the following -
Medical emergencies are sudden and can cause financial issues immediately. One may have to put in all their savings or sell their belongings to pay for treatment. A medical insurance plan can give stability by covering such expenses and give one the opportunity to prioritise their expenditures.
One can select an insurance plan based on their medical history, family history, age, gender, and requirement. Many people get medical insurance for parents, and some opt for floater family medical insurance. One should clearly understand all the aspects of their medical insurance and clear their doubts before choosing a policy.
Many insurance companies are associated with hospitals for cashless insurance payments. Cashless payment is one of the most important benefits of any medical insurance. When one requires urgent medical attention, their family doesn’t have to run around looking for cash. The insurance company can bear all the hospital expenses incurred, even when the patient is actively getting treatment.
One tends to compromise on treatment when money is an issue. With the ability to pay using family medical insurance or any other policy, one can choose the best doctors, medical facilities, and treatment options.
When comparing market size for FY20 and FY21 in India, the new business insurance premium has seen an increase from US$36.7 billion to US$37.1 billion. The renewal insurance premium has seen an increase from US$43.9 billion to US$53.3 billion (Ref IBEF). Even though the numbers are massive, the ground reality is very different.
Many people in urban and rural India are still doubtful about the need for insurance. Without creating awareness about medical insurance, it will be difficult for the insurance industry to reach its estimated growth by 7-9% in terms of gross direct premium income in FY22.
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