Health insurance sector poised for more growth
by Nishant Mehta General InsuranceWith the arrival of Cigna TTK, there are
now five standalone health insurers offering products and services in India.
Religare Health is also a recent entrant that started operations only last
year.
At a time when we are seeing
several exits in the life insurance sector, this is an indicator of the growth
potential in India’s health insurance sector.
Health insurance as a vertical has seen
very good growth rates in recent years compared to others in the insurance
space. The table below shows the numbers:
Year |
2009-10 |
2010-11 |
2011-12 |
2012-13 |
Premium
Collected (in 100,000 rupees) |
8,388 |
11,480 |
13,469 |
15,701 |
Growth |
37% |
17% |
17% |
What’s interesting is that health
insurers are spread across the price spectrum and don’t necessarily play the
price-sensitive game to win premiums.
Star Health is more focused on the low
premium segment, while Max Bupa also caters to the high premium segment.
But the biggest winner is the customer
as we have seen a lot of innovative offerings – mostly from standalone
insurers.
Star Health, for instance, has a plan
for heart patients and one for diabetes patients. We also have Apollo Munich
with its “Restore” feature in which the cover amount gets restored in case it
gets exhausted in a particular year.
More companies are now being forced to
offer similar benefits, or better them – that too at very attractive prices.
With healthcare getting expensive and
awareness increasing, more people are going in for sophisticated plans.
At the same time, there is also a
gradual breakdown of the company group plan support structure. An increasing
number of companies are asking employees to share a larger part of the premium
burden.
The breadth of cover in group plans is
also being reduced – like the exclusion of parents from plans provided by the
company.
The pattern of employee attrition also
makes a very strong case for not relying on company-sponsored cover. Firms, on
their part, see higher attrition and hence don’t want to invest in expensive
covers for workers. Better to offer employees higher payouts and make the
healthier employees happier.
If we see changes in FDI rules as
growth picks up in the coming years, we might see more specialised health
insurance companies setting up shop in the country.
There is still a long way to go and
with increasing competition among insurers, customers will get a lot of
benefits.
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Created on Dec 31st 1969 18:00. Viewed 0 times.