• 100% bill payment is one of the most important features that both policyholders and potential buyers wish to have in their health insurance policy
• 60% of the respondents claim that are aware of the terms and conditions stated in their health policy
• However, 68% have health covers under Rs. 10 lakh at a time when medical costs in India are at an all time high

The COVID-19 pandemic has ignited an awakening to health and its paramount importance. This crisis served as a catalyst, magnifying awareness about health and driving a surge in the recognition of the vital role of health insurance. But would you believe that 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, Indians have revealed themselves to be underinsured. 68% policyholders surveyed only have a medical cover of under Rs. 10 lakh, with 27% having medical cover under Rs. 5 lakh. What’s more, 64% have not increased their coverage from the previous year. 61% of potential buyers are not looking at buying health insurance with a sum insured over Rs. 10 Lakh and 65% 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. 48% of the policyholders state that a health insurance policy gives them timely and quality access to healthcare, 46% say it is important because the pandemic had an adverse effect on health while 43% mention that it helps meet rising medical costs.

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.

Even amongst potential buyers, 30% are considering buying their health insurance directly from the insurance provider digitally while 36% say they will opt for policies sold by aggregators and 33% prefer going to a third party for their insurance needs.

“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.