Health Insurance Market in India 2022

Health Insurance Market in India 2022

Market insights

Nearly 950 million individuals (or 215 million families) are eligible for health insurance. However, the actual coverage is low since not all households eligible for government-subsidized insurance are covered at present. Also, there are overlaps between different health insurance schemes.

The health insurance market was valued at INR 1,886.25 Bn in FY 2021. It is expected to reach INR 2,517.90 Bn by FY 2027, expanding at a CAGR of ~5.12% during the FY 2021 ─ FY 2027e period. Since government-subsidized schemes are expected to cover the eligible population, the potential health insurance coverage is of 70% (based on the existing landscape).

Technology insights:

Technology can help in optimizing processes, reducing costs, and expanding the customer base of market players. Health insurance firms have invested in innovative technologies such as automation, AI, and big data. Internet of Things (IoT) helps in deriving extensive data and insights to curate risk management tools and systems. Furthermore, it helps in strengthening customer information repository, enabling firms to offer timely and pertinent coverage based on individual needs. As IoT can generate large volumes of client data, brokers also offer additional value-added services through data analysis and management.

Impact of COVID-19:

In the wake of the pandemic, the Insurance Regulatory and Development Authority of India (IRDAI) issued several directions to ensure business continuity of insurance providers and intermediaries. The IRDAI had granted an extension of the payment of health and motor vehicle third-party insurance with due date between March 25, 2021, and May 3, 2021, to renew their policy by May 15, 2021. Furthermore, the grace period for health insurance policy renewal, which was in March 2021, was extended to May 31, 2021.

The health insurance market has witnessed the adoption of group insurance products in view of the pandemic. Edelweiss-Gallagher, a composite health insurance firm, has launched a group insurance product for the informal sector. The plan covers factory workers, food delivery agents, and frontline workers in healthcare and pharmaceutical industries.

Competitive insights:

Emerging health insurance companies occupy the highly competitive health insurance space. With high demand, at present public and private players are aiming at increasing their offers and improve the quality of service, to dominate the market. The players are focusing on scaling up their businesses and portfolios to address the high potential of the market.