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In India, health and specialised health insurers have been rolling out focussed health insurance covers against COVID-19 in the last 3 months. The demand for health insurance has witnessed a significant rise with the government lockdown and coronavirus pandemic. There is a positive impact of COVID-19 as more and more people have started investing in health plans.
As per available statistics, health insurance-related queries have gone up by 50 per cent and the talk time has also increased significantly over the past couple of weeks. The COVID-19 outbreak is most likely to boost growth in health insurance in a relatively under-insured market by increasing the health insurance penetration rate.
Increase in Demand for Plans with Higher Coverage
Apart from a rise in demand for health insurance plans, there is also demand for health insurance plans with higher sum insured. People buying health insurance plans with higher sum insured have increased drastically. Earlier, the share of people buying health insurance plans with Rs 20 lakh to Rs 1 crore sum insured was less than 5 per cent. However, the share has now increased to 50 per cent over the last 2-3 months. This is generally because earlier, people used to have a false perception towards health insurance. To them, Rs 5-7 lakh sum insured health insurance plans seemed significantly large and enough to take care of all medical expenses. For many, the amount was sufficient to sustain their individual as well as family’s needs and requirements in case something untoward happens, which leads to sudden hospitalisation. However, they have started to realise the fact that this perception is wrong.
While the scope of healthcare and medical treatment is improving by leaps and bounds in the country – delivering more positive outcomes – the flip side has been a massive increase in the cost of medical treatment, and to be more precise-quality medical treatment. Fortunately, health insurance is available to take care of various unforeseen health emergencies. As per insurance market trends, the number of people investing in plans with higher sum insured i.e. 1 crore has significantly gone up. As of all the health insurance policies being sold online in the last 3 months, 40 per cent are the ones with Rs 1 crore sum insured. A major reason for the significant surge in the number of people investing in such plans is the highly affordable prices at which they are being offered.
Maximum Coverage at Affordable Pricing
For example, the plan being offered by Religare, i.e. Care Advantage, is available for Rs 13,590 for a 32-year-old individual. The plan comes with zero co-payment and without any sub-limits. Similarly, Max Bupa Health Insurance’s Super Saver plan with Rs 1 crore sum insured is built with a combination of two elements-Rs 5 Lakh Base Plan (which also acts like the deductible) and Rs 95 Lakh Super Top-up. Unlike other usual health insurance plans where the deductible is to be paid by the customer during the claim, under this plan, the deductible element of the plan acts as the base plan and hence the customer does not have to pay anything regardless of the claim amount.
For instance, if there is a claim of Rs 3 Lakh, the amount will be paid by the insurer from the base policy and the consumer need not make any payment. The premium for a 30-year male living in a metro city costs Rs 10,992 while adding a spouse to the plan brings the premium to Rs 14,729.
Eliminates the Need of CI Plan
Meanwhile, trends also say that more people are buying health insurance cover with higher sum insured instead of buying a basic health policy with a CI (critical illness) plan add-on as the premium in the former case is cheaper by Rs 5,000. A higher sum insured is necessary in a health insurance plan if you want to combat the high medical costs. So, isn’t it better to choose a health plan with the maximum coverage level based on your needs? And with cost-effective plans today already available in the market, the affordability must not be a concern.
(By Amit Chhabra, Head-Health Insurance, Policybazaar.com)