In this article you will learn about the changes marked by the post-pandemic world on health insurance industry such as new-age coverage and overall awareness. Read on!
What is the paradigm shift in Health Insurance in post-pandemic era?
In March 2020, the world was hit by the deadly coronavirus that completely changed the way we live. How we choose to spend every day, what we do in our leisure time, and our appreciation for loved ones all underwent a change. Possibly the biggest shift felt across the globe was the increased awareness of health and overall wellbeing.
The deadly virus not only made people of all age groups conscious, but it also reshaped the way insurance providers viewed policy designing, primarily including benefits provided and premiums charged.
India being the world’s second most underinsured country, faced deadly impacts during the COVID-19 outbreak. 1 Studies suggest that around 86% of the rural population and 82% of the urban population were not covered under any medical insurance. 2 This brings us to the slightest silver linings of COVID-19: a change in how Indians view health insurance.
The pre-and post-COVID-19 era shows an interesting picture of healthcare insurance in the country. Through this article let’s evaluate the changes; both positive and negative.
Health insurance in post-pandemic world: Evaluating the changes
The post-pandemic world is a lot more aware and is always on the lookout for information on personal well-being. In addition to jumping on healthcare trends, there has been an evident shift in the approach towards health insurance plans. Here’s how:
1. Health insurance for all
COVID-19 was a wake-up call not only for senior citizens but millennials who have also come forward looking for comprehensive health insurance. Medical insurance for senior citizens is no longer the only type of plan in demand. Surprisingly, the demand for health insurance in India shot up by almost mammoth 321%, especially in metropolitan cities like Delhi, Bengaluru and Mumbai. 3
2. Policies with new-age features
An interesting shift has been observed in the way policies are designed. Pre-COVID era policies are majorly focused on offering awareness and wellness talks, seminars, or walkathons. The post-Covid era has seen a shift where policies are more focused on offering rewards rather than awareness. In fact, around 57% of health insurance policyholders showed their preferences for rewards and comprehensive coverage. 4
3. The connection of pandemic trauma and medical inflation
COVID-19 left the world in shock, but beyond its deadly impacts pandemic forced all of us to realise the rising medical cost. Before COVID-19, people were more aware of expenses related to personal health and well-being, where medical inflation had taken the back seat. However, with reports suggesting around 14% medical inflation, post-pandemic era marked a considerable shift in how people think about inflation.
4. Analysing coverage is foremost priority
Earlier, even those who owned health insurance did not evaluate every benefit carefully. However, now people are focusing on coverage offered under a plan, which is the reason insurance companies provide enhanced coverage such as medical inflation cover, no-claim bonus, coverage for pre-existing illnesses, fitness-rewards, mental well-being etc. which make the coverage a comprehensive one.
5. Critical Illness is not the Only Reason
Before COVID-19, health insurance coverage was taken primarily to cover critical illnesses. A study suggests that only 39% of the total people who bought health insurance opted for a comprehensive policy, and 86% took health insurance solely for covering critical illnesses if any. At present, comprehensive health insurance is the focus for people of all age groups that offer 360-degree coverage. 4
6. People become more diligent about health
In addition to a general awareness about healthcare insurance, there is an overall rise in concern amongst Indians about their health. For instance: A recent survey conducted suggests that 54% of people are worried about their family members contracting a severe disease. 4 This has increased the demands for mediclaim policy for families. Nowadays finding family health insurance plans at affordable rates can be easy.
Health insurance in post-pandemic world: Shift in policy providers’ approach
Post-COVID-19 impacts were not limited to policy seekers; a stark difference can be seen in the way policy providers view healthcare insurance. Let’s take a look at some of the key changes for health insurance companies:
1. Customised solutions for personal requirements
Due to the rise of awareness amongst policy seekers, policy providers are now providing customised solutions to meet personal requirements. Additionally, there is a general growth in the data analysis on the part of policy providers to plan their healthcare insurance policies to come at par with the changing demands.
2. The state of premiums on healthcare insurance
To manage finances efficiently, post-COVID-19 marked an increase in health insurance premium rates. For instance, a survey was conducted on policyholders, and almost 52% of them witnessed an increase in premiums by 25%. In fact, the rise in premiums was also significant since 21% of policy owners claimed to have faced an almost 50% increase in premiums. 6
3. Digitalisation of the insurance industry
The insurance industry has become digitalised, offering people the ability to evaluate every aspect of an insurance policy while sitting in the comforts of their homes. The two key reasons for this gradual shift have been: COVID-19 restricted movement to a great extent and the online application process made insurance policies accessible to all.
4. Flexibility to choose tenure and coverage
To match the changing demands, insurers are now more willing to provide flexibility in their plans so that policy-seekers can customise it as per their insurance needs. Most insurance companies now provide multiple features to help policy seekers manage costs through co-payment, deductibles and even EMI option.
5. Coverage against medical inflation
Before COVID-19 providing coverage against medical inflation was a rare feature provided by insurance companies. At present, insurance companies have started covering inflation as well as in-built or optional cover.
6. Comprehensive coverage for advanced treatments
In recent years, treatment for diseases that were considered incurable has become accessible at advanced healthcare facilities. In addition to medical inflation coverage, medical insurance is now available with higher coverage up to crores as well.
7. Hassle-free claim handling
What might have appeared impossible at one time is now a norm. This is particularly true when one evaluates the pre and post-COVID insurance industry. Artificial intelligence and a completely digitised process have made claim settlement easier for policyholders and reduced the burden on insurance companies, as well.
To Conclude
COVID-19 has shaped the way we view our lives, our approach towards healthcare and overall well-being. The impact on the insurance industry has been felt significantly both by existing policyholders and policy seekers. A positive side of this change has been the rise in awareness about health, staying prepared to face any medical emergency and accessibility to comprehensive insurance plans for people of all age groups.
Disclaimers:
1. The above information is for reference purposes only: Policy Assurance and Claims at the underwriter's discretion.
2. All plan features, benefits, coverage, and claims underwriting are subject to policy terms and conditions. Kindly refer to the brochure, sales prospectus, and policy documents carefully.
