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Posted at: Mar 14, 2019, 6:52 AM; last updated: Mar 14, 2019, 6:52 AM (IST)

Less than 26% individuals have health insurance in region

Lack of awareness to blame for low coverage

Vijay C Roy

Tribune News Service

Chandigarh, March 13

The health insurance penetration in the region comprising Punjab, Haryana and Chandigarh continues to be abysmally low due to lack of awareness. According to data, merely 1.53 crore individuals or less than 26% of the total population in the two states and the UT of Chandigarh was covered under any health insurance in 2017-18.

Despite the expansion of private sector coverage in the region, growth in health insurance is mostly driven by government-funded schemes or social insurance followed by private sector coverage which is largely limited to urban households. The penetration of individual health insurance policies is extremely low.

In Haryana, a majority of the individuals are covered under insurance by corporate players or employers where these individuals are employed whereas in Punjab a significant portion of the population is covered under government-sponsored health insurance schemes. The number of employed persons covered by health insurance in Punjab is very less as a majority of the units fall under micro, small and medium enterprises.

In Haryana, around 44.15 lakh individuals are covered under group health insurance offered by employers compared to 4.98 lakh in Punjab and Chandigarh.

According to the data, only 22 lakh individuals have bought individual policies in these two states and Chandigarh.  According to insurance players, lack of awareness is the prime reason for low penetration of health insurance.

"A huge part of North Indians don't buy health insurance to finance their medical expenditures because of lack of awareness. Taking a step in this direction, the industry is planning to run a campaign on the lines of mutual fund industry," said Mayank Bathwal, CEO, Aditya Birla Health Insurance Company Ltd.

He said the launch of government's flagship health insurance scheme under 'Ayushman Bharat', which is aimed at covering around 50 crore individuals, will increase the awareness about health insurance.

"In order to increase the penetration of health insurance policies, insurance players are working on various customer-centric programmes. Since customers are more digitally inclined, we have built a pro-health digital ecosystem. It also enables the consumer to search for nearest doctors and pharmacies," he added.

Perturbed over low rate of coverage, especially in the rural areas, and high expenditure on health services, the insurance regulator has urged private insurance providers to reach out to uninsured in the remote areas. Healthcare providers have been asked to devise mechanisms to keep cost of treatment in check.

Currently, 62% of the average health expenditure in India is borne out of pocket against the world average of 18%, Insurance Regulatory and Development Authority of India (IRDAI) said.

Across the country, over 48 crore people are covered with health insurance. There are three forms of insurance coverage providers - government (35-40 crore individuals), corporate (approximately 7 crore) and retail (3-5 crore) where individuals purchase the policy. Currently, Indian health insurance industry is pegged at Rs 45,000 crore and is growing at 25% annually.


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