Why was the research conducted?To understand the impact of COVID-19 on health Insurance purchase
How was the research conducted?Extensive secondary research was conducted to capture purchase behaviour trends in the Health Insurance Sector
What are the key findings of the research?Industry Outlook: With more than 25 private insurance companies & 4 public insurance companies, the overall health insurance industry in India has been growing at a CAGR of 22% for the last 5 years. The 5-year CAGR for public insurance companies stood at 16%, while among private insurance companies, the general health insurance companies are growing at a CAGR of 26% & standalone health insurance companies are growing at a CAGR of 36%.
With gradual increase in cases in February & March, India went into a 21-day countrywide lockdown on 25th March. Was the global pandemic able to create a sense of urgency among Indians to buy health insurance?
The gross premium income has increased by 22% this year compared to the previous year and is in line with category CAGR of 22%. But the gross premium income in March 2019-20 saw a drop of 13% compared to March 2018-19, indicating many people showing hesitance to purchase health insurance.
This hesitance could be due to lack of clarity - whether normal health insurance policies would cover COVID-19 treatments or will they have to buy a separate standalone policy.
With recent circulars from IRDAI to cover COVID-19 related treatments under existing policies, insurance companies have started creating awareness around it through their website & other media channels such as text messages & E-mails. The companies are also promoting online health insurance policies on social media.
These initiatives by health insurance companies are already showing positive inclination as the Google search trends for “Covid insurance” reveals an upsurge in the month of April, indicating we may see an increase in adoption in the April to June quarter, which otherwise see fewer adopters.
With many facing a first-time pandemic situation, the overall perception of health insurance has evolved. The government has also given it a giant push, by stating it to be covered under all existing policies. This might significantly alter the cost vs. risk evaluation by Indian consumers.