Health Insurance Driven By Technology

With the onset of the pandemic, the health insurance industry has undergone a sea of changes over the last two years. The pandemic has made everyone realise the uncertainties of life and their unpreparedness in case of any health related emergency. 

Since the commencement of Covid, health insurance premiums have been the main driver of the non-life insurance industry. In spite of a long nationwide lockdown, the health segment grew significantly by 34.2% in YTD (Year to date) July’22 in comparison to a growth of 9.9% witnessed in YTD July FY’21. 

Whilst we have seen a rapid growth of the overall health insurance sector, some key changes/ trends to look out for the next year are:

Consistent growth momentum: The growth engine/ trajectory will continue as the health insurance category has gained the attention of the consumers. With a major shift in consumer perception of the industry, the focus has gradually moved from sickness insurance to health insurance. The underlying cause of this change has been the rising cost of hospitalization that has made people understand the need of buying health insurance. Consumers have now started viewing health insurance as an essential investment that brings in a wholesome health cover. 

New and innovative offerings: There is a growing opportunity for the industry to come up with new and innovative product offerings that fulfil the unmet needs of the customer. A large part of the customer segments still doesn’t have specialised health policies for them. There is a big gap in the market currently that is waiting to be filled with innovative and customised products.  For e.g., offerings for people with certain conditions from Day 1, offerings to cover outpatient expense coverage, look at certain segments of customers whose needs have not been fully  met yet, etc. 

Common Health Claims platform: Swasth alliance, a collaborative, was launched last year by Swasth Digital Health Foundation (a Not-for-Profit initiative) to leverage digital technologies that will drive healthcare inclusion and improve health outcomes. This will enable in creating a digital backbone for an integrated healthcare delivery and also make the communication between all stakeholders seamless and bring in standardisation to the whole process. 

Providing coverage to the missing middle: As per the recent Niti Aayog report, while the Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) and state government extension schemes, provide comprehensive hospitalization cover to the bottom 50% of the population, another 20% are covered through social health insurance, and private voluntary health insurance. The remaining 30% of the population is devoid of health insurance; and is termed as the missing middle. The existing infrastructure of Ayushman Bharat can be utilised to extend cover to the missing middle population. 

New distribution channels: We will see the emergence of large consumer tech platforms as distribution channels for health insurance. With the rising need and value of health insurance, such newer channels will definitely aid in a much refined customer experience along with enabling to create a curated offering with personalization. This will also help in creating a model that is both transparent and personalised. 

Technology & digitisation: There will be a growing use of technology and digital to create new opportunities, not just to acquire customers, but also in helping customer lifecycle management. If health insurers have transitioned to remote sales and service teams, customers too have become quite adept in availing digital services in every step of the typical health insurance process. Customers have now started extensively using their health insurers’ apps and website for accessing information and processing requests. We expect this rise in use of digital services to be a permanent fixture in the domestic insurance industry. 

Disclaimer: The views expressed in the article above are those of the authors’ and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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