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Health insurance is no longer a push product but a pull product, believe insurers. While initial demand in recent months was due to the pandemic, gradually, more people are buying medical cover on their own and insurers believe the demand will continue to increase.
“The pandemic created a lot of awareness on health insurance. Initially, insurers were a bit sceptical about how much of the demand was due to a fear of Covid and how much was awareness. Now we see that the interest in health insurance and awareness also has increased. People are looking at various types of products and are more focussed on understanding the offerings,” said Shreeraj Deshpande, Head – Health Businesses, SBI General Insurance.
He expects the health insurance segment to continue growing faster than other lines of business for non-life insurers.
“Earlier, the demand for health insurance was driven by major towns and cities but even people in Tier 2, 3 and 4 cities are buying such covers now,” he said, but stressed that the penetration of health insurance in the country still has a long way to go.
Instead of Covid specific covers, people are looking at comprehensive policies, and the average sum insured has increased to anywhere between ₹3 lakh and ₹5 lakh.
Also see: ‘Pandemic has reinforced need for insurance and risk mitigation’
Anup Rau, Managing Director and CEO, Future Generali India Insurance, also said the demand for health insurance has not gone down despite the ebbing of the second wave of the pandemic.
“One of the things we discovered is that the effort required to advise the customer to buy a health insurance policy is far lower. I think people have an appreciation for health insurance,” he said.
A recent report by CareEdge noted that the outlook for the health insurance in India remains bright. It is expected to grow at 26 to 29 per cent in the current fiscal and between 16 and 18 per cent CAGR for the following five years.
“The growth would be driven by increasing life expectancy, urbanisation, income levels, pandemic-led awareness, more individuals subscribing to health insurance, existing customers increasing their sum assured, availability of wide range of products that offer varied health covers, and possible rate increase considering the increase in claim ratios in FY21 and the first half of this fiscal,” it added.
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