Are more people buying health insurance policies now? Find out

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November 27, 2020 1:35 PM

According to the recently released report, overall growth in the health business has been muted at 6% YoY in October 2020.

buying health insurance policies, group insurance, COVID-19, medical cost, IRDAIIt is always suggested to have an independent health insurance policy and not to rely entirely on employer-provided group insurance plan.

After the outbreak of the COVID-19 pandemic, the demand for health insurance was widely perceived to go up. With rising medical cost and especially the exorbitant cost associated with the treatment of coronavirus, a rush was witnessed to buy health insurance plans. IRDAI also allowed insurance companies to launch exclusive plans to cover the coronavirus treatment in hospitals. According to the recently released Kotak Institutional Equities Report, overall growth in the health business has been muted at 6% YoY in October 2020. The retail health category, however, saw a 30 per cent growth in the same period.

A sharp 9% YoY decline in group health (up 29% YoY in 2QFY21) was witnessed. Kotak Institutional Equities in its report says that October does tend to be a weak month for group health business. A slowdown in growth in retail health was likely an interplay of (1) slowdown in daily new Covid-19 cases in India and (2) lower volumes during the festive season. It is always suggested to have an independent health insurance policy and not to rely entirely on an employer-provided group insurance plan.

Standalone health insurers reported a 32% YoY increase in health premiums, led by a 43% YoY increase in the retail health business. Private players were up 3% YoY in the health business (up 17% in retail health) while PSUs were down 7% YoY. Among major private players, SBI, Tata AIG and ICICI Lombard witnessed strong growth in retail segments at 49% YoY, 21% YoY, 95% YoY and 32% YoY respectively; Star Health and Aditya Birla Health up 45% and 58% YoY respectively.

Key highlights

Aditya Birla Health and Star Health retain strong momentum. The premium for standalone health insurers was up 32% yoy led by strong growth for all players. This has, however, moderated slightly over the past few months (36-42% yoy over the past four months). HDFC Ergo Health was muted at 1% yoy. Aditya Birla Health and Star Health continued to see strong growth; up 56% yoy and 45% yoy respectively in October 2020 (up 71% yoy and 45% yoy respectively in 7MFY21).

ICICI Lombard: Retail health was in line with the industry average (up 32% yoy),while Group health was muted at 2% yoy (down 9% yoy for the industry).

Bajaj Allianz General Insurance: . Health insurance premiums were down 24% yoy despite 16% yoy growth in retail health (group health down 4% yoy and the company did not any have any premiums from government business during the month).

Chola MS: Retail health slowed down during the month (down 46% yoy).

SBI General Insurance: Health increased 65% yoy (83% yoy growth in group health and 49% yoy increase in retail health).

Buying health insurance policies for self and family members is a better way to ensure one doesn’t have to dip into savings to meet hospital bills. If you don’t have one or want to enhance coverage, it is better not to contemplate rather take the step now.

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