The report surveyed 1000 respondents across six metros Indian cities between the ages of 28 and 55 and identified that 60% of the respondents feel they understand the terms and conditions of their health insurance policy. (Representational Image: DC)
The COVID-19 pandemic magnifyied the awareness about health and the vital role of health insurance. Most individuals are not adequately covered for health-related emergencies. ACKO, India’s tech-first insurance company, reveals surprising data in its new report, ‘The ACKO Health Insurance Index’. The report surveyed 1000 respondents across six metros Indian cities between the ages of 28 and 55 and identified that 60% of the respondents feel they understand the terms and conditions of their health insurance policy. However, the assessment of policyholders’ comprehension of terms and conditions highlighted limited awareness of only three crucial features - cashless treatment (53%), accident covers (50%), and 100 percent bill payment (45%).
Is India adequately covered for future medical emergencies?
Worryingly, through the survey it was revealed that Indians are underinsured. Nearly 68 per cent policyholders surveyed only have a medical cover of under Rs 10 lakh, with 27 per cent having medical cover under Rs 5 lakh. What’s more, 64 per cent have not increased their coverage from the previous year. It further revealed that 61 per cent of potential buyers are not looking at buying health insurance with a sum insured over Rs 10 lakh and 65 per cent stated that coverage of upto Rs 10 lakh is adequate. Therefore, it is evident that Indians are putting themselves at considerable financial risk by not opting for a sufficient cover.
Health Insurance Expectations
100% Bill Payment: Over 46% of policyholders believe that their health insurance policy will cover the entire bill of hospitalization along with consumables. Similarly, 59% of potential buyers are actively looking for a health insurance policy that offers 100% bill payment.
Waiting Periods: 31% of policyholders believe that they are covered by their health insurance policy from day 1 while 27% have stated that there are no waiting periods in the health insurance policies.
Family Floater Plans: The most popular health insurance policy amongst both potential buyers and existing policyholders are Family Floater Plans. 71% of policyholders and 72% of potential buyers would opt for a family floater plan since it allows them to add their parents, spouse, and children to the same policy without having to buy separate policies.
Deterrents for potential buyers and policyholders when it comes to health insurance policies
Claim Process: 43% of both policyholders and potential buyers expressed that a slow and cumbersome claim settlement process is a deterrent when it comes to health insurance policies.
Lack of 100% Bill Payment: A major factor for potential buyers and policyholders when evaluating health insurance policies is that they want insurance companies to pay the entire bill of hospitalization. The lack of this feature is a deterrent for 47% of policyholders and 56% of potential buyers.
Lack of number of network hospitals: 41% of both policyholders and 44% of potential buyers are concerned about the insurers not having a good network with hospitals.
Is having health insurance necessary?
Although existing and potential customers are opting for a low sum insured, they strongly feel that having a health insurance policy is a must. When it comes to potential buyers, 48% feel it is necessary to have a health policy irrespective of any health condition, 44% believe it will offer them the best medical care and 41% understand it will address the inflated healthcare costs.
Moreso, for more than 50% of the potential buyers the decision of buying a health insurance policy is influenced by family, relatives, friends, and financial advisors.
How are customers buying their health insurance?
It is interesting to note that when buying insurance policies, potential buyers as well as policyholders are looking to purchase directly from the insurance company. With 30% of policyholders having bought their health policy directly from the insurer highlights that customers are gaining awareness about buying directly without the involvement of agents, thereby receiving cost benefits. However, 52% of customers have bought their policies from third parties.
"Understanding the customer's mindset regarding their health insurance needs is crucial. It is important to know how they evaluate their options and what gaps they want their insurers to fill. The ACKO Health Insurance Index has identified these gaps when it comes to health insurance. These gaps can be filled by new age insurers like ACKO to provide their customers with a better health insurance experience," said Rupinderjit Singh, Vice President- Retail Health at ACKO, during the launch of the report.