JAMNALAL BAJAJ INSTITUTE OF MANAGEMENT STUDIES

UNIVERSITY OF MUMBAI

STUDY OF BUYING BEHAVIOUR OF HEALTH INSURANCE.

IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR

MASTER OF MARKETING MANAGEMENT

2018-2019

ROLL NO: 16 M 412

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 ACKNOWLEDGEMENT

I am using this opportunity to express my gratitude to everyone who supported me throughout the

course of this Year Long project. I am thankful for their aspiring guidance, invaluably constructive

criticism and friendly advice during the project work. I am sincerely grateful to them for sharing their

truthful and illuminating views on a number of issues related to the project. I express my warm thanks

to my Project Guide for his support and guidance during the period of my project work. I would also

like to thank the Director of Jamnalal Bajaj Institute of Management Studies for providing me the

opportunity to embark on this project. Last but not the least I would like to give my sincere regards

to all my friends and college staff for their co-operation towards completion of my project.

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 Index

Sr No. Content Page No.

1 Executive Summary 4

2 Introduction 7

3 Literature Review 13

3.1 Selection of Health Insurance 14

3.2 Perception of Customer 16

3.3 Background of Health Insurance 17

3.4 Advantages of Health Insurance 20

3.5 Features of Health Insurance 22

3.6 Main & Important functions of Health Insurance 24

3.7 Need to spread health insurance awareness 33

3.8 Awareness and booming of health insurance 35

3.9 Current scenario of health insurance 36

3.10 Regulatory frame work 44

3.11 Distributions f Channels 48

3.12 Key players 50

4 Research Objectives and Methodology 57

5 Finding and Analysis 60

6 Conclusion 69

7 Bibliography 76

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 1. EXECUTIVE SUMMARY

This Research work is totally focusing on the consumer behavior towards different types of Health

Insurance Policies, and as well as consumer‘s awareness, Also opinion about the determinants of

perception of a Health Insurance.

As today many Health Insurance Companies are coming in the city, for selecting sample sampling

technique was used. Sample consists of all those people who are above 18 year age.

This project has been made on the research on HEALTH INSURANCE: “BUYING BEHAVIOUR

OF HEALTH INSURANCE”. Purpose of this project is to identify the characteristics of different

variables which are mostly responsible for taking health insurance policy by the people and also the

main aim of research work is to find out buying behavior of the people before purchase insurance

policy and to find out what are the factor behind it.

Health Insurance is medical expense insurance. It is sometimes used more generally to cover

disability insurance or long-term care or custody needs. It can be provided through a social insurance

program sponsored by governments or by private insurance companies. It can be purchased by a

group (e.g. a company that covers its employees) or by individual’s consumers. In each case, the

groups or individuals concerned pay premiums or taxes to protect themselves against high or

unexpected health costs. Similar benefits for medical expenses can also be provided through

government-funded social welfare programmes.

By estimating the overall risk of expenditure on healthcare, a routine financial structure (such as a

monthly premium or annual tax) can be developed to ensure that money is available to pay for the
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health benefits specified in the insurance contract. The benefit is provided by a central organization

such as a government agency, a private company or a non-profit organization. The most important

thing learned from this project is how to investigate a specific problem using different research

methodologies.

The health insurance market covers a very small part of India's total population (about 10 percent).

Currently in India there are schemes such as voluntary health insurance schemes or private profit

schemes; employer-based schemes; NGO/community-based health insurance schemes and

mandatory health insurance schemes or government-run schemes (ESIS, CGHS). India's health

insurance market is unique and has developed a strong growth potential with the entry of many

foreign players into the market in recent years. India's health insurance market amounted to INR

5,125 crores with a compound annual growth rate of 37 percent from 2002 to 2008. Although the

market for health insurance is still relatively small, it is one of India's fastest growing industries.

This research analyzes this growing industry in its Health Insurance Industry in India research report.

The report analyzes the industry as a whole in terms of growth rate, market segments and the main

players in the industry.

The growth will be supported by independent health insurance companies and new players entering

the healthcare market with improved healthcare infrastructure throughout the country, which will

motivate a larger section of the population to provide better healthcare services through different

healthcare policies. Currently, state-owned health insurance companies account for about 70 percent

of the market and private companies occupy the rest.

Private companies are however growing rapidly and aim to occupy a larger hare in the health

insurance market in the near future. This report attempted to discuss the vital scenario in India's

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healthcare and health insurance market. A brief on the global insurance industry in 2006, the Indian

insurance industry and the overview of the health insurance industry are discussed. Growth drivers

and industry issues are also covered. Major public and private players are covered in terms of

performance, products and perspectives.

The future perspective of the industry is also discussed. The report will be useful for insurance

companies (both Indian and global), other industry intermediaries, industry analysts, TPAs

companies and insurance students.

Since the liberalization in 2000, India's insurance industry has grown significantly due to a number

of favorable economic and demographic factors. During the review period, the Indian health

insurance market grew by 34.00 percent at CAGR and is expected to increase by 23.51 percent over

the forecast period to record the fastest growth in all insurance sectors.

Factors such as robust economic growth, changing demographic patterns such as the rise in families

without children's double incomes, increased FDI limits and the expansion of distribution channels

are expected to contribute to market growth during the forecast. Of India's total healthcare

expenditure, only 26 percent come from local, state and central government authorities, while the

patient's family pays 5 almost 71 percent. Insurance accounts for only 3% of India's total health care

expenditure, which represents a significant opportunity for the health insurance sector. The health

insurance market is dominated by companies in the public sector and the private sector has made

progressive progress in the sector.

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 2. INTRODUTION

Health Insurance – An Insurance coverage that pays your medical bill or hospitalization expense or

surgical operation whenever arises or is insurance that covers some or all of the costs of an

individual’s healthcare.

“Health insurance aims that one can access to the best health care without fearing the financial

strain, it help people to have peace in mind rather than to have fear”.

The diagnosis of a disease and the need for hospitalization can be a tough test for both the rich and

the poor, both male and female, young and old. Diabetes, heart problems, stroke, renal disease

insufficient, cancer etc. Today's list of lifestyle illnesses appears more and more common.

Fortunately, more specialist hospitals and doctors exist–but all this is at a price. These costs the super-

rich can afford, but what about a medium-sized person?

It is well known that more than 75 percent of the population uses the private sector for medical care,

which is unfortunately becoming more expensive every day and almost out of reach of the poor.

Today, substantial resources need to be injected into the health sector to ensure the affordability of

medical care for all. Health insurance is an important option that policymakers and planners need to

consider. As already mentioned, the cost of health insurance depends on the amount guaranteed, age,

current health and your previous medical history.

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What are the ideal health insurance requirements? No default answer or rule of thumb. If we agree

that health insurance is important, you must look at your own lifestyle, health, age / life, family history

and affordability. Keep in mind that most insurance companies limit the guaranteed amount to no

more than 5 lakhs. Note also that many health insurance policies offer additional benefits such as

daily allowance, ambulance fees, etc. To hospitalize. Not only are benefits superfluous, they tend to

lead to higher premiums. It is therefore best to avoid such plans and stick to something simple and

fundamental.

Health insurance is a form of group insurance in which people pay premiums or taxes to help protect

themselves against high or unexpected health costs. Health insurance works by estimating the overall

"risk" of health expenditure and by developing a routine financial structure (such as a monthly

premium or annual tax) to ensure that money is available to pay for healthcare benefits specified in

the insurance agreement.

Today, most comprehensive private health insurance programs cover the cost of routine,

preventive care, and emergency health care procedures, and also most prescription drugs, but

this was not always the case. Under the plan of insurance, a large number of people associate

themselves by sharing risk, attached to individual insurance plan that exclusively covers healthcare

costs and is called Health Insurance.

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The insurance concept is closely related to security. Insurance acts as a shield from unforeseen

risks and circumstances. In general, Indians are by nature risk- averse rather than risk-lovers.

Fig 2.1 comprehensive product

Some major health insurance companies PSU and SAHI (Stand Alone Health Insurance companies)

in India include National Insurance Company, New India Assurance, United India Insurance, Oriental

Insurance, ICICI Lombard, Religare Health Insurance, Star Allied Health Insurance, Max Bupa

Health Insurance, Apollo Munich Company among others.

India's rapidly growing demand for affordable health cover attracts greater attention from businesses,

with life and non- life insurance companies now entering the market with innovative new medical

insurance products and savings. This intensive competition for health insurance customers has only

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intensified in recent months with the introduction by some of the largest insurance groups in the

country of new savings- related and investment- oriented health insurance schemes.

The biggest challenge for insurers remains the low awareness of the value of obtaining adequate

coverage as a valuable savings and investment tool in many parts of the country. This problem is

addressed slowly as more insurers develop their product and distribution platforms to reach

previously untapped regions and customer bases with more innovative and affordable coverage

products, including micro insurance and local bank.

In India, customer satisfaction levels for health insurance have consistently fallen below comparable

levels elsewhere, with critics often mentioning both disease and hospital coverage as low. In contrast

to other homogeneous general insurance products, health premiums are based on the health of an

individual policyholder, leading to confusion and fraud on the Indian market and increased policy

cancellations from customers who find no value in their health policy.

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Many banks, financial institutions and insurance intermediaries have seen a great opportunity in the

marketing of insurance products. Insurance brokers play an important role in bringing together

insurance companies and insured persons, and their role when a claim arises is important. Research

includes health insurance awareness, preference for health insurance consumption patterns, new

insurance services, claims settlement and major health insurance issues.

Health insurance policy does not always cover every possible health problem someone might

encounter in the future. There are certain terms and conditions agreed to by the insured (person who

is taking the plan), and the insurer (entity that is providing the plan) and the entire procedure happens

according to what has been agreed to in the contract.

The normal logic of young people is that they do not need such a plan, because physical problems

rarely affect them. In fact, people can fall prey to an illness or other physical problem at any time-

nobody can be absolutely certain of a life completely free of this problems. Normally, when someone

gets older, the problems increase and there are always the possibilities for some major diseases. A

problem with trying to obtain a medical insurance in old age is that, because there are more chances

of a medical condition, the premium is often high or the insurer is not prepared to cover the person.

There is high probability that the person will not get any policy at high age bracket if they have not

taken earlier. It is wisely advice that the person should take Health insurance policy when he is young

age and are fit with a decent cover looking at the medical inflation and the rise in hospital expenses

and doctor fees etc.

India's insurance industry opened its doors in 2001 to private and international investors. Over the

past ten years, coverage rates across the populous South Asian country have doubled and several

more developed financial markets have been overtaken by the domestic insurance industry. The total

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number of insurance policies sold has increased several times, and combined premium incomes are

now projected to range from US$ 350 billion to US$ 400 billion by 2020. Health insurance in

particular has become one of the fastest growing insurance lines in the country, accounting for

nearly a third of last year's new written premiums.

The introduction and increased proliferation of private sector players has worked to both develop

innovative new coverage products and increase service standards for clients in the domestic market.

Of particular note has been how the entrance of several major life insurance brands, including Life

Insurance Corporation of India, Aviva Life Insurance and Max Life Insurance, has affected the market

recently. These life insurers offer largely savings-based health plans that provide lump sum

compensation to clients in case of a critical illness or other malady specifically defined by a specific

policy. These long-term products have tenures that can last up to 20 years. When the policy expires,

customers are entitled to receive the value of the fund. Usually this is not a cashless process because

payment is reimbursed when medical bills are submitted. Most of these life insurance plans are unit-

linked insurance products (Ulips) whose returns are determined by the performance of the stock

market.

Despite the positive growth indicators, India‘s health insurance market still has many problems to

contend with in order to match its true potential going forward. The most important challenge for

insurers remains the low level of awareness concerning the value of obtaining adequate coverage as

a valuable savings and investment tool across much of the country. This problem is slowly being

addressed as more insurers develop their product and distribution platforms to reach previously

untapped regions and client bases with more innovative and affordable coverage products, including

micro insurance and local bank.

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Indian consumers are already aware of this and have taken part in health insurance schemes, and the

industry is facing the continuing challenge of keeping them satisfied.

The level of customer satisfaction for health insurance in India has consistently fallen below

comparable levels elsewhere, with critics frequently citing the low coverage of both disease and

hospital coverage plans. In contrast to other homogeneous general insurance products, medical plan

premiums are based on the health of an individual policyholder, leading to confusion and fraud on

the Indian market and increased policy cancellations from customers who do not find any value in

their health insurance policies.

With a population of only 2 percent of the country’s 1.2 billion, India offers an enormous potential

in the health insurance market. There are more than 30 medical insurance products in the life and

non- life insurance categories. While ICICI Lombard, Bajaj Allianz and Reliance General are some

of the prominent general insurers in the health insurance space, Apollo Munich, Max Bupa Health

Insurance, Religare Health Insurance, Star Health & Allied Insurance etc are the standalone players.

Health insurance‘s annual premium collections are above Rs 6,000 crores.

The interesting findings about health insurance in India were people's perception of health insurance.

It is seen as a way of protecting savings. It is not intended to protect the health asset. This is probably

common in developing markets, where wealth predominates in health. In India, health risks are

perceived differently than in the West. India's level of insurance penetration is very low compared to

the global average. This has led to a multitude of distribution channels, such as agents, brokers,

banking — channel (bank insurance model) avenues, internet insurance or direct mail. In the

marketing of insurance products, many banks, financial institutions and insurance intermediaries have

seen a great opportunity. Insurance brokers play an important role in bringing insurance together

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companies and the insured, and their role assumes importance when a claim arises. Research includes

awareness of health insurance, preference of health insurance consumption pattern new services

offered by insurance sectors, claim settlement procedure, and major issues of health insurance. Health

insurance policy does not always cover every possible health problem someone might encounter in

the future.

3. LITERATURE REVIEW

When a person has a bad health shock, their medical expenses typically increase and their contribution

to household income and home production (e.g. Cooking or care for children) decreases (e.g.

Doorslaer and Wagstaff, 2003; Gertler, Levine & Moretti, 2003; Gertler and Gruber, 2002). In

accordance with the WHO, ―Every year, approximately 150 million people experience a financial

disaster, which means that they have to spend more than 40 percent of the income they have after

meeting their basic needs on health care. (WHO Factsheet N ° 320, 2007) Low income and high

medical expenses can also lead to debt, the sale of assets and the removal of children from school,

especially in poor countries.

Therefore, a short-term health shock can contribute to long-term poverty (for example. Van Damme

et coll, 2004, et coll., 2006). At the same time, because households often cannot borrow easily, they

can instead give up high-value care. It is often of poor quality when accessing care (Das, Hammer

and Leonard, 2008), which can lead to poor health results.

Theory suggests that health insurance can address some of these problems. By covering the costs of

health care after a health shock, insurance can help reduce asset sales and new debt, increase the

quantity and quality of care and improve health outcomes.

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Sadly, there is little rigorous evidence of the impact of insurance and fewer studies are available on

the effects of insurance in developing countries. One reason for this lack of evidence is that it is

difficult to find a valid control group for the insured. We cannot simply compare the results of insured

and uninsured households, as the health insurance status is typically linked to other household

characteristics. For example, rich and well educated households typically have both better health and

better health insurance coverage but the positive correlation between health and insurance status tells

us nothing about the impact of insurance. On the other hand, those in poor health may be more likely

to pay for health insurance, but finding that the insured tend to be sicker would not imply that

insurance causes illness.

Below we examine past evidence on the effects of health insurance, focusing on studies in which

the status of health insurance is plausibly exogenous or studies in which self-selection attempts to

eliminate bias.

3.1 SELECTION OF HEALTH INSURANCE:

It is important to understand who chooses to purchase voluntary health insurance in order to

understand both the aim of the insurance product and the financial viability of the insurance program.

As explained below, the latter is particularly susceptible to negative and positive choices. The extent

of negative selection or positive insurance selection has a significant impact on an insurance

provider's ability to cover its costs.

Standard theory of insurance predicts that insurance markets will suffer from adverse selection, which

occurs when fewer healthy people or people who are more risky with their health are more willing to

buy health insurance because they know that the amount they spend on health care is higher than the

premium they pay. (e.g. Rothschild and Stiglitz 1976; Akerlof 1970) Voluntary health insurance can

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not be financially sustainable if adverse selection is severe, as only the most expensive patients would

find it worthwhile to buy insurance, and premium levels can not cover the high cost of care.

Some studies in wealthier nations find evidence that people with higher expected medical

expenditures (measured in a variety of ways across studies) are more likely to buy insurance or pay

for health insurance at higher premiums than those with lower expected medical expenditures (e.g.

Cutler and Zeckhaus, 1998). However, the extent of adverse selection in health and other insurance

is often found to be minimal (e.g. Wolfe and Goddeeris, 1991; Finkelstein and Poterba, 2004) or non-

existent (e.g. Finkelstein and McGarry, 2006; Cardon and Hendel, 2001; Cawley and Philipson

(1999). There is also some recent evidence of positive selection into health insurance (e.g. Fang et

al., 2008).

The literature review suggests that income is one of the important determinants of purchase of health

insurance (Scotton 1969, Cameron, Trivedi et al. 1988, Savage and Wright 1999).

Income has been found to be having a positive association with health insurance purchase decision

consistently in different studies conducted in different countries Propper (1989) in UK; Cameron,

Trivedi et al. (1988)in Australia and Hurd and McGarry (1997) in USA, Healthcare expenditure is

another important variable affecting health insurance purchase (Kronick and Gilmer 1999).

Relation of health insurance purchase decision and health expenditure is based on the premise that

families which have higher chances of requiring hospitalization will have higher probability of buying

health insurance. Some other socio economic factors like age, education etc. have also been found to

be important factors affecting health insurance purchase In India knowledge and awareness about

health insurance could be important factor for health insurance purchase decision.

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Choices in health insurance whether or not to purchase private health insurance (Barrett and Conlon

2003). For the analysis of determinants of this type of purchase decision, binary models of discrete

choice using either legal or prohibited were used. Cameron and Trivedi (1991) specified a conditional

utility function for alternative health regimes. The consumer opts for a system that maximizes the

expected utility. The advantages of purchasing private insurance are primarily linked to people's

expected medical needs. Some people are more vulnerable to risk than others due to their age, pre-

existing state of health, employment and marital status.

The consequence is that not only is a better educated person healthier, which reduces the likelihood

of insurance, but he / she is also better informed about both the services in the public hospital system

and the benefits of joining a private health insurance fund. The indirect effect of education is its

impact on revenue and the benefits of joining a private health insurance fund.

Education and income are generally positively correlated (Van De Ven and Van Praag 1981).

Higher income generally decreases the opportunity cost associated with the purchase of private health

insurance. Overall, increases in both income and education would be expected to lead to an increase

in the probability of buying the insurance.

The demographic and economic variables are another important element in the health insurance

literature. These variables comprise employment, age, marital status and sex.

The available evidence indicates that socio-economic variables are expected to act. Employees and

managers will probably buy insurance (Butler 1999; Savage and Wright 1999). It is more likely to

married people out coverage (Cameron & McCallum 1995), though family size apparently has been

of little influence on the purchase decision (Cameron and Trivedi 1991).

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3.2 PERCEPTION OF CUSTOMERS

Risk perception to people is also an important factor. A consumer's knowledge that he or she is at

risk by being a member of a certain group of high-risk people (e.g. those who know they have high

cholesterol are likely to influence their decisions on insurance, smokers tend to buy less insurance.

However few studies have attempted to estimate price elasticity of demand. This is because of lack

of price information and also because of limited variation in price in highly regulated health

insurance market.

The studies on health insurance in India are scant. A number of recent papers and reports have

examined the Indian health system (Bhat and Mavalankar 2000, Berman and Khan 1993, World

Bank 1995, Planning Commission 1996, etc.). These studies have documented the problems and

challenges facing the system with regard to accessibility, efficiency and quality of the provision of

health care.

As per the current market scenario now the people are aware of the critical illness rising

exponentially such as Cancer, Kidney failure, CABG – Open Heart Surgery etc. and they need an

insurance company which can secured them with high sum insured with the lowest premium.

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3.3 - BACKGROUND OF HEALTH INSURANCE: CURRENT SCENARIO
India's health care system is characterized by a number of medical systems, mixed patterns of

ownership and various types of delivery structures. Public sector ownership is divided between

local government, municipal government and Panchayat. Public health facilities include teaching

hospitals, secondary hospitals, referral hospitals at the first level (CHCs or rural hospitals), clinics;

primary health centers (PHCs), sub-centers and health centers. Selected professional groups, such

as organized staff (ESI), defense, government staff (CGHS), railways, telegraph and postal

services and mines, also have public facilities.

The private sector (for profit and not for profit) is the dominant sector with 50% of people seeking

indoor care and approximately 60 to 70% of those seeking outpatient care from private healthcare

facilities. While India has made significant gains in demographic, infrastructural and

epidemiological health indicators it continues to face new challenges. Not only have

communicable diseases persisted over time, but some such as malaria have also developed

insecticide-resistant vectors, while others such as tuberculosis are increasingly resistant to drugs.

HIV / AIDS has lately become extremely virulent.

The 1990s also saw an increase in mortality due to non-communicable diseases resulting from

changes in lifestyle. The country is now suffering from a dual burden of communicable and non-

communicable illness. This is accompanied by spiraling health costs, a high financial burden on

the poor and income erosion. About 24 per cent of all hospitalized persons in India fall below the

poverty line due to hospitalization in one year. An analysis of hospitalization financing shows that

a large proportion of people, especially those in the four bottom quintiles, borrow money or sell

assets to pay for hospitalization This situation exists in a scenario in which healthcare is financed

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by general tax revenues, community financing, out of pocket payment and social and private health

insurance schemes. India spends about 4.9% of GDP on health. The per capita total expenditure

on health in India is US$ 23, of which the per capita Government expenditure on health is US$ 4.

Hence, it is seen that the total health expenditure is around 5% of GDP, with breakdown of public

expenditure (0.9%); private expenditure (4.0%). The private expenditure can be further classified

as out-of-pocket (OOP) expenditure (3.6%) and employees/community financing (0.4%). It is thus

evident that public health investment has been comparatively low. In fact as a percentage of GDP

it has declined from 1.3% in 1990 to 0.9% as at present. Furthermore, the central budgetary

allocation for health (as a percentage of the total Central budget) has been stagnant at 1.3% while

in the states it has declined from 7.0% to 5.5%.

SOCIOECONOMIC INDICATORS
Land area 2% of world area

Burden of disease (%) 21% of global disease burden

Population 16% of world population

Urban : Rural 28:72

Literacy rate (%) 65.38

Sanitation (%) Rural – 9.0; Urban – 49.3

Safe drinking water supply (%) Rural – 98; Urban – 90.2

Poverty (%) Below poverty line – 26

Rural – 27.09; Urban – 23.62

Poverty line (Rs.) Rural – 327.56; Urban – 454.11

Fig 3.3 Socio economic indicators table

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India has developed a large public health infrastructure in the last 50 years with more than 150

medical collages, 450 district hospitals, 3000 community health centers and 20,000 primary health

centers and 1,30,000 sub-health centres. In addition, there are a large number of private and NGO

health facilities and practitioners throughout the country.

Over the past 50 years, Indians have made considerable progress in improving their health. The

death rate fell from 40 per thousand to 9 per thousand, the infant mortality rate fell from 161 to 71

per thousand and the life expectancy increased from 31 to 63. Many challenges remain, however:

life expectancy 4 years below the world average, high incidence of communicable diseases,

increased incidence of non-communicable diseases, neglect of female health, significant regional

variation and threats to environmental degradation. In India, 40 to 50 million people are estimated

to receive medicines for major diseases at any time. About 200 million workdays are lost annually

due to illness. Survey data show that approximately 60 percent of people use private healthcare

providers for outpatients, while 60 percent use indoor treatment public healthcare providers. The

average private sector care expenditure is 2 to 5 times higher than in the public sector.

India spreads Heath expenditure by about 6 percent of GDP. Health care expenditure accounts for

75% or 4.25% of GDP and the majority (1.75%) of government funding. Currently, insurance

coverage is insignificant. The majority of public funding for preventive, promotional and primary

care programs has grown at a rate of 12.84 percent per year and private health care expenditure

has increased by 1.47 percent for each current per capita increase in private doctors and clinical

facilities.

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The Indian health financing scene poses a number of challenges that increase health care costs, a

high financial burden on poor people eroding their incomes, an increase in the burden of new

diseases and health risks and a neglect of preventive and primary care and the function of public

health due to government underfunding.

Given the above scenario exploring health- financing options become critical. Health insurance is

considered one of the financing mechanisms to overcome some of the problems of our systems.

3.4 - ADVANTAGES OF HEALTH INSURANCE:

There are now different market insurance policies, such as life insurance, vehicle insurance, but

the importance of health insurance appears to be growing rapidly. Health insurance is used

primarily to protect a person from any unexpected medical expenses caused by illness. With the

current state of affairs, it is observed that healthcare has improved enormously with the latest

technologies or advances, but the costs do so. Treatments become increasingly expensive with

each passing day. “It is said that earlier the basis needs was Food, clothing and shelters but

nowadays Food, Clothing, Shelters, Health and Terms Insuarance is a need of an hour.

Everyone needs to receive financial security for any unexpected medical expenses. The main

benefits of health insurance are mentioned below:

1. Hospital cash benefits- this benefit entitles you to get cash benefits, if you are

hospitalized. All the financial expenses incurred would be covered in this plan. The amount

22
 provided to you will be on per day basis and the amount depends upon the plan you have

opted.

2. Cashless facility- in this benefit, you can get hospitalized on the basis of this plan without

paying a penny. But this benefit can be availed only in panel listed network hospital of an

insurance companies. Sometimes the amount paid by you, is reimbursed within 24 hours

or according to the hospital refund procedure.

3. Pre and Post expenses- As per this policy all the expenses related to illness incurred 60

days prior to 90 days after hospitalization would come under the benefits that you can avail

i.e Doctor fees, prescription, diagnose test etc. pertaining to the illness for which he/she

has admit for.

4. Floater benefits- This is the benefits where an individual as well as the family member

are secured or insured in one policy where in overall family members can avail the

hospitalization benefits whenever arise.

5. Bonus - The policy holder is entitled to a bonus ranging from 10% to 150 % of bonus

amount of the sum assured every year as a bonus added to their policy. Bonus are in the

form of No claim bonus and Loyalty addition bonus depending upon the companies which

they opt for their family members.

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 6. Room Rent Capping: Most of the PSU companies have the room rent capping at the time

of hospitalization but private companies do not have such restrictions for a client to choose

the room for their choice. Normally in PSU companies a customer can take only 1% of the

sum insured or cover amount.

Eg : - If the sum insured is of 5 lacs then the customer can take only Room upto 5,000/-

and if takes above that then the difference amount need to be bear by the customer.

3.5 - FEATURES OF HEALTH INSURANCE:

Though the features may vary from insurer to insurer, some basic features are:

 Reimbursement for Hospitalization due to illness/disease/ surgery.

 Cashless Facility

 Room Rent Capping (this includes ICU expenses)

 Day care treatment

 Reimbursement for Domiciliary Hospitalization expenses in lieu of Hospitalization.

 Pre-hospitalization Expenses

 Post-hospitalization Expenses

 Ambulance Charges

 AYUSH treatment (Ayurveda, Yoga, Unnani, Siddha and Homeopathic)

 OPD Benefits

 Tax Benefits (under 80D) etc

The above points are the most important for a customer to think of buying the policy of any

companies depending upon the affordability of the customer. Insurance may be described as a

24
social device to reduce or eliminate risk of life and property. Under the plan of insurance, a large

number of people associate themselves by sharing risk, attached to individual insurance plan that

exclusively covers healthcare costs and is called Health Insurance. Since the past two decades,

there has been a phenomenal surge in acceleration of healthcare costs. This has compelled

individuals to have a re-look on their actual monthly expenditures, spending patterns and

simultaneously allocate a proportion of their income towards personal healthcare. This has resulted

in individuals availing healthcare insurance coverage not only for themselves but also for their

family members including their dependents. In short, healthcare insurance provides a cushion

against medical emergencies. The concept of Insurance is closely concerned with security.

Insurance acts as a shield against risks and unforeseen circumstances. Some of the major

companies in India includes New India Assurance, Oriental Insurance, National Insurance, United

India Insurance, ICICI Lombard, Star Health & Allied, Apollo Munich, Max Bupa, Religare

Health, Bajaj Allianz etc are among others.

Indian Health Insurance basically classified in two major categories:

 Cashless Facility

 Reimbursement Facility

a) Cashless Hospitalization:- It means a person can get admitted to the hospital without

paying a penny from his pocket and get treatment done. There are two types of cashless

done one is from the TPA company which normally take care for almost all PSU companies

or government company and second is directly from the company which is the private

players or the standalone companies.

25
CASHLESSLESS HOSPITALIZATION CAN BE OF TWO TYPES

 Planned hospitalization: This is a planned hospitalization wherein the insured is aware of

the hospitalization in advance. This duration period may vary from case to case. Examples:

Chemotherapy treatment for carcinoma (cancer), for cataract surgery, tonsillectomy

(removal of tonsils), removal of parts from body or implantation into body etc. then for

cashless they need to take a prior approval depending on the TAT for the particular

companies normally it is 48 hours before the hospitalization.

Emergency hospitalization:

 It is a sudden hospitalization that may be either an emergency or due to unforeseen

circumstances. In short, hospitalization is not anticipated in advance. Examples include

RTA (Road Traffic Accident), Myocardial infarction (heart attack), Acute Appendicitis.

b) Medical Reimbursement - Reimbursement means repayment or compensation. Medical

reimbursement therefore means repaying the products / services used during

hospitalization more importantly after completion of the treatment. Under this procedure,

the insured must bear all the costs incurred during hospitalization. The insured / policy

holder can claim medical reimbursement after being released from hospital. In order to

benefit from this option, the insured must approach the TPA concerned under which he /

she is covered, fill in the required form and satisfy all the requirements as mentioned. This

includes submission of a TPA card, policy paper, discharge summary, prescriptions,

laboratory diagnostic reports, OPD treatment details, etc. A sum is granted to reimburse

treatment costs.

26
3.6 - MAIN FUNCTIONS AND IMPORTANCE OF HEALTH INSURANCE:

The primary function of health insurance is to pay the costs covered by an accident or illness, as

described in the policy. It often has two elements, one of which is hospitalization costs and the

other is health care costs provided by a doctor or other health care professional. The vast majority

of health insurance companies are employers, giving people access to health insurance through

their jobs. Not all employers offer it and are free to independently obtain individual / family

policies for those whose employers do not.

Health insurance comes in a multitude of different types. These include traditional compensation

plans, which are becoming less common, and a variety of care plans under management, including

healthcare organizations and preferred providers. Both provide prepaid medical care, but differ in

their delivery models, including the degree of choice the member retains. Although different

terminology can be used, most health insurance plans have deductibles and co-payments. A

deductible is an amount to be paid by the insured before the liability for payment is triggered by

the insured person. Co-payment is a form of cost sharing in such a way that the insurer pays a

percentage of the expense covered and the insured pays the rest. The deductible size and the co-

payment have an effect on the premium. Insurance can be described as a social instrument to

reduce or eliminate the risk of property and life.

3.6 - HEALTH INSURANCE IN INDIA:

Today, the increasing cost of medical treatment is beyond a common man's reach. In the event of

a medical emergency, the cost of renting a hospital room, the doctor's fees, medicines and related

27
health services can be a large amount and sometimes it cannot be affordable. Health insurance

provides much-needed financial assistance in such times. An investment in health insurance is

a wise decision. The health insurance scheme could be an employer-sponsored personal scheme

or a group scheme. Some current health insurance schemes are individual, family, group and senior

citizens, insurance schemes, long-term health care and health insurance cover for specific diseases.

HEALTH INSURANCE IS DIVIDED INTO THREE TYPES IN INDIA:

1) SOCIAL:

 ESIS( Employees state Insurance Scheme)

 Central Government Health Scheme (CGHS)

 Self-Employed Women‘s Association (SEWA)

2) COMMUNITY BASED HEALTH INSURANCE:

3) PRIVATE:

 Individual policy

 Group Mediclaim policy (also known as GMC).

1) INSURANCE OFFERED BY NGOS / COMMUNITY-BASED HEALTH INSURANCE:

Community-based funds refer to schemes in which members prepay a fixed amount for certain

services each year. The premium is usually flat (not related to income) and thus not progressive.

The purpose of these funds is not to make profits, but to improve access to services. There is often

a problem with adverse selection due to a large number of high-risk members, as premiums are

not based on individual risk assessments. Exemptions can be taken as a means of helping the poor,

28
but this will also have a negative effect on the insurance fund's ability to cover the cost of benefits.

Community-based schemes typically target poorer populations in communities involved in

defining contribution levels and collection mechanisms, defining the content of the benefit package

and/or allocating financial resources (International Labor Office Universities Program 2002, as

cited in Ranson K & Acharya A2003).

Such schemes are generally run by trust hospitals or non-governmental organizations (NGOs). The

benefits offered are mainly in terms of preventive care, though ambulatory and in-patient care is

also covered. Such schemes tend to be financed through patient collection, government grants and

donations. Increasingly in India, CBHI schemes are negotiating with the profit insurers for the

purchase of Custom designed group insurance policies. However, the coverage of such schemes is

low, covering about 30-50 million. A review by Bennett, Cresses et al. indicates that many

community-based insurance schemes suffer from poor design and management, fail to include the

poorest-of-the poor, have low membership and require extensive financial support. Other issues

relate to sustainability and replication of such schemes.

SELF-EMPLOYED WOMEN’S ASSOCIATION (SEWA), GUJARAT:

This scheme established in 1992, provides health, life and assets insurance to women working in

the informal sector and their families. The enrolment in the year 2002 was 93 000. This scheme

operates in collaboration with the National Insurance Company (NIC). Under SEWA‗s most

popular policy, a premium of Rs 85 per individual is paid by the woman for life, health and assets

insurance. At an additional payment of Rs 55, her husband too can be covered. Rs 20 per member

29
is then paid to the National Insurance Company (NIC) which provides coverage to a maximum of

Rs 2 000 per person per year for hospitalization. After being hospitalized at a hospital of one‗s

choice (public or private), the insurance claim is the responsibility for enrolment of members, for

processing and approving of claims rests with SEWA. NIC in turn receives premiums from SEWA

annually and pays them a lump sum on a monthly basis for all claims reimbursed.

1) THE VOLUNTARY HEALTH SERVICES (VHS):

Chennai, Tamil Nadu was established in 1963. It offers sliding premium with free care to the

poorest. The benefits include discounted rates on both outpatient and inpatient care, with the VHS

functioning as both insurer and health care provider. In 1995, its membership was 124 715.

However, this scheme suffers from low levels of cost recovery due to problems of adverse

selection.

2) SOCIAL INSURANCE OR MANDATORY HEALTH INSURANCE SCHEMES OR

GOVERNMENT RUN SCHEMES (NAMELY THE ESIS, CGHS)

Social insurance is an earmarked fund set up by government with explicit benefits in return for

payment. It is usually compulsory for certain groups in the population and the premiums are

determined by income (and hence ability to pay) rather than related to health risk. The benefit

packages are standardized and contributions are earmarked for spending on health services The

government-run schemes include the Central Government Health Scheme (CGHS) and the

Employees State Insurance Scheme (ESIS).

3) CENTRAL GOVERNMENT HEALTH SCHEME (CGHS):

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Since 1954, all employees of the Central Government (present and retired) some autonomous and

semi-government organizations, MPs, judges, freedom fighters and journalists are covered under

the Central Government Health Scheme (CGHS). This scheme was designed to replace the

cumbersome and expensive system of reimbursements. It aims at providing comprehensive

medical care to the Central Government employees and the benefits offered include all outpatient

facilities, and preventive and promotive care in dispensaries. Inpatient facilities in government

hospitals and approved private hospitals are also covered. This scheme is mainly funded through

Central Government funds, with premiums ranging from Rs 15 to Rs 150 per month based on

salary scales. The coverage of this scheme has grown substantially with provision for the non-

allopathic systems of medicine as well as for Allopathy. Beneficiaries at this moment are around

432 000, spread across 22 cities.

The CGHS has been criticized from the point of view of quality and accessibility. Subscribers have

complained of high out-of-pocket expenses due to slow reimbursement and incomplete coverage

for private health care (as only 80% of cost is reimbursed if referral is made to private facility

when such facilities are not available with the CGHS).

4) EMPLOYEE AND STATE INSURANCE SCHEME (ESIS):

The ESIS programmed has attracted considerable criticism. A report based on patient surveys

conducted in Gujarat found that over half of those covered did not seek care from ESIS facilities.

Unsatisfactory nature of ESIS services, low quality drugs, long waiting periods, impudent behavior

of personnel, lack of interest or low interest on part of employees and low awareness of ESI

procedures, were some of the reasons cited.

31
5) OTHER GOVERNMENT INITIATIVES

Apart from the government-run schemes, social security benefits for the disadvantaged groups can

be availed of, under the provisions of the Maternity Benefit (Amendment) Act 1995, Workmen‗s

Compensation (Amendment) Act 1984, Plantation Labour Act 1951, Mine Mines Labour Welfare

Fund Act 1946, Beedi Workers Welfare Fund Act 1976 and Building and other Construction

Workers (Regulation of Employment and Conditions of Service) Act, 1996.

The Government of India has also undertaken initiatives to address issues relating to access to

public health systems especially for the vulnerable sections of the society. The National Health

Policy 2002 acknowledges this and aims to evolve a policy structure, which reduces such inequities

and allows the disadvantaged sections of the population a fairer access to public health services.

Ensuring more equitable access to health services across the social and geographical expanse of

the country is the main objective of the policy.

6) VOLUNTARY SCHEMES OR PRIVATE (PROFIT OR NON PROFIT)

Buyers in private insurance are prepared to pay premiums to an insurance company that pools

people with similar risks and insures them for health costs. The key distinction is that the premiums

are set at a level that gives third parties and supplier institutions a profit. The premiums are based

on an assessment of the consumer's (or group of employees ') risk status and the level of benefits

provided, rather than as a proportion of the consumer's income.

The General Insurance Corporation (GIC) and its four subsidiaries (National Insurance

Corporation, New India Assurance Company, Oriental Insurance Company and United Insurance

32
Company) and Life Insurance Corporation (LIC) of India offer voluntary insurance schemes in the

public sector. Ashadeep Plan II and Jeevan Asha Plan are offered by Life Insurance company II.

II. The General Insurance Corporation offers Personal Accident Policy, Jan Arogya Policy, Raj

Rajeshwari Policy, Mediclaim Policy, Cancer Policy, Bhavishya Arogya Policy and Dreaded

Disease Policy. Mediclaim is the main product of GIC of the various schemes offered.

The Medical Insurance Scheme or Mediclaim was introduced in November 1986 and it covers

individuals and groups with persons aged 5 –80 yrs. Children (3 Months – 5 yrs) are covered with

their parents. This scheme provides for reimbursement of medical expenses (now offers

cashless scheme) by an individual towards hospitalization and domiciliary hospitalization as per

the sum insured. There are exclusions and pre-existing disease clauses. Premiums are calculated

based on age and the sum insured, which in turn varies from Rs 15 000 to Rs 5 00 000. In 1995/96

about half a million Mediclaim policies were issued with about 1.8 million beneficiaries. The

coverage for the year 2000-01 was around 7.2 million.

Another scheme, namely the Jan Arogya Bima policy, targets the poor population groups in

particular. It also covers hospitalization reimbursement costs up to Rs 5 000 per year for an

individual premium of Rs 100 per year. This scheme is subject to the same exclusion mechanisms

as in the Mediclaim policy. A family discount of 30% is granted, but a group discount or agent

commission is not available. Like Mediclaim, however, this policy has only had limited success.

By 1997, the Jan Arogya Bima Scheme had only covered 4,00,000 people. The year 1999 marked

the start of a new era in Indian health insurance. When the Insurance Regulatory Development

Authority Bill (IRDA) was passed, the insurance industry was opened up to private and foreign

33
participation, paving the way for private health insurance companies to enter the country. The Bill

also facilitated the creation of an authority to protect the interests of insurance holders by

regulating, promoting and ensuring the orderly development of the insurance industry. The bill

allows foreign promoters to hold up to 26 percent of paid capital in an Indian company and requires

them to have a capital of Rs 100 crore together with a business plan to start up their business. At

present, some companies, including Bajaj Alliance, ICICI, Royal Sundaram and Cholamandalam,

offer health insurance plans. The nature of the programs offered by these companies is briefly

described.

3) PRIVATE-:

A) Individual policy- A health policy can be obtained by two different means: individually or

through group insurance. In individual insurance, a person talks to the health insurance provider

one-on - one to obtain an agreement that would have met most of their requirements. Personal

health insurance allows you to choose what you want and nothing saddles you with. Many people

prefer personalized health insurance for what they want. To be honest, they have given up any

knowledge of their family's disease history so that their cases can be thoroughly evaluated. The

risk of being rejected before the policy starts is greater in the case of a single policy. This is due to

the smallest possible factors which affect any policy clause. Sometimes insurance companies do

this to save costs and payments that may not be needed.

B) Group Health Insurance Policy: Contrary to this, there is a group insurance policy because

there are fewer opportunities; insurance companies usually do not refuse to pay duties to persons

in a group policy. Group insurance policies tend to be more successful and less susceptible to

34
obstacles; often in-depth inspections are not carried out as with individual health policy. The

reason for this is that insurance companies are suspicious of people approaching them; they believe

that there must be a special reason to approach them. Sometimes this is true, and therefore people

tend to be scrutinized much more than group members.

The best of the GHI – (Group Health Insurance) the person gets the benefits from the very 1st day

and there is no waiting period for any illness.

GHI - Business is working on a very large scale by PSU companies likes New India, Oriental,

National Insurance and some private players like Star Health & Allied, Iffco Tokiyo General

Insurance, Bajaj Allianz insurance, The premium for the Government company is very nominal

which suffice the need for a company to give medical benefits to their employees.

3.7 - NEED TO SPREAD HEALTH INSURANCE AWARENESS:

The health insurance conditions in India are not clear. 85% of Indians do not use medical insurance

to finance their medical expenses. These people pay from their pockets for their medical expenses.

As a result, many of these uninsured persons either end up in poor health care or face financial

difficulties. The financial stress caused by increasing medical costs is believed to affect the

lifestyle of all members of the family for years. If the same goes on, how will India pay for its

medical costs in the future? How will the efforts of physicians be fruitful if no one receives medical

treatment?

There is therefore a need to increase the number of persons insured in India. In this direction

everyone, every healthcare provider and every health insurance company should play an active

35
role. Only then can quality healthcare be provided to people in times of medical emergency.

Insurers have designed plans, but people should be encouraged to buy them so that the overall

condition of medical care insurance in the country can be improved.

The products and offerings brought by different medical insurance providers vary from each other.

The only point that should be brought to light is that people should buy these products to remove

inconveniences from quality medical treatment. These products offer much relief to them and their

family members at the time of medical emergency.

There is no need for an insured person to arrange funds at the last hour. The government and all

associated bodies should therefore all offer their support in raising awareness of health insurance

so that Indian citizens are aware of the right to seek quality health care without financial

consideration.

The health of its citizens is one of the top priorities of the nation. A nation with healthy people can

follow its agenda dexterously and execute those with good eyes.

Total healthcare promotes economic growth, decreases poverty and reduces mortality. Many

countries ' success lies in their special efforts to cover the entire population with a health insurance

scheme that protects them from unforeseen health risks through insurance and wellness

programmes.

36
The convergence of health insurance is immediately well established. In India, as in many other

low per capita countries, the burden of unplanned payments and expenditure on medical treatment

affects a large population very acutely. The total health expenditure in India amounts to about 5

percent of gross domestic products (GDP), the bulk of which is financed by private households as

mentioned above.

The Government should educate people about the rise of medical costs and the importance of these

products. Regulators should bring change in the guidelines, allowing only the right players to enter

the health insurance market. Health insurance providers should design products, according to

health needs of target customers and encourage people to buy them. The combined efforts of all

these bodies will surely bring some improvement.

There should be a separate dedicated team should be taken care in each and every company to

recheck if the hospitals are not charging too much for which they are not supposed to as this will

impact customers pocket and on the coverage amount. Due to lack of awareness of illness and the

cost which includes Doctors fees, prescription, diagnostic tests etc. customers end up in paying

high bills at the hospitals.

3.8 AWARENESS HELP TO BOOMING HEALTH INSURANCE IN INDIA:

Health insurance is the second largest segment in the Indian non-life insurance industry. It has

gone up in the past fiscal years and is set to reach new heights in the coming years, as public and

private insurers come up with different schemes to cover the untapped insurance market.

According to our latest findings, the health insurance industry in India is one of the most productive

37
in the world. As healthcare costs and awareness increase in the country, the segment is expected

to grow with gross premiums increasing by around 32.5 percent in the CAGR between 2010-11

and 2013-14.

In recent years, India's health insurance landscape has undergone tremendous changes with the

launch of several health insurance schemes, largely initiated by central and state governments. We

observed that a substantial proportion of coverage was achieved through central and state health

insurance schemes. In addition, private and public health insurers have introduced a number of

plans and schemes to cover an individual and his family against critical problems such as heart

failure, stroke and kidney failure.

As a large proportion of the population in India lives with HIV / AIDS, private health insurance

companies are taking advantage of the great opportunity to draw up special policies for these

people. India was soon able to see a national HIV medical insurance policy (PLHIV). The National

Aids Control Organization, we observed during the study and analysis of trends in the Indian health

insurance industry, plans to make insurance "inclusive and universal for PLHIV ".

During the health insurance market analysis, researcher found that there are around 28 active third

party administrators (TPAs) in India, and the TPA infrastructure in the country has witnessed a

strong growth with the rising penetration of health insurance. The TPAs are recognized as valuable

service providers in the health insurance services delivery chain. Our comprehensive report also

found that the development and growth of health insurance has led to the need to maintain and

38
optimize the processing and management of claims. It aims to improve the services that health

insurance companies offer for the maximum benefit of the insured.

According to the study, health insurance portability is also gaining popularity in India as it allows

health insurance policyholders to switch companies while retaining their no-claims benefit. The

report also provides an overview of the rural health insurance segment, and expects that the number

of uninsured rural households will decrease with time. Various Insurance Regulatory and

Development Authority (IRDA) acts and amendments have also been studied to understand the

regulatory framework for the industry. The research also looks into profiles of various players in

public and private sectors to present the competitive landscape and a balanced outlook of the Indian

health insurance industry to clients.

3.9 - CURRENT STATUS OF PRIVATE/PUBLIC HEALTH INSURANCE IN INDIA

India has lessons to learn from Chile's experience. India also has a dual care system–a private

service fee sector in which individual households pay pocket money and a tax-based public sector

in which suppliers are being paid. The use of insurance under these two systems is partially limited

and based on the household budget's affordability and availability. Insurance, on the other hand, is

a much more sophisticated mechanism that requires a comprehensive understanding of the health

insurance market failures.

For example, a problem like information asymmetry disadvantages the patient and the insurer

because they cannot resist or challenge an existing medical opinion. condition or future treatment.

Besides, in the absence of knowledge of prices, the provider can short change the two by

39
overcharging. Second, cashless insurance creates disincentives to control costs as it appears to be

a free‗ good for the patient and the provider, often resulting in excessive treatment by the provider

(induced demand) and frivolous use by the patient taking treatment even for a condition which he

would normally have ignored or cured with a home remedy (moral hazard).

Third, only the patients know their state of health. Since those in need of health care tend to

subscribe to health insurance, insurance agencies risk resorting to extensive risk selection

processes, such as medical examination, before they are admitted as a registrant and focus on low-

risk groups such as young or healthy. However, risk selection in individual policies results in an

increase in loading fees and, consequently, in premium costs. This is one reason why attractive

group discounts are up to 67%. For these reasons, it is well known that private commercial health

insurance selects its customers –young, healthy, rich, male–leaving bad risks to the government–

old, poor, young women in the reproductive age group and the ill.

Health insurance in India is usually linked to GIC's Mediclaim Policy, which was introduced in

1986 as a voluntary public health insurance scheme. The premium based on the age, risk and

benefit package opted for ranged from a minimum Rs 201 premium for those over 25 years of age

to a maximum benefit of Rs 15,000 with group membership discounts. In 2001, 78 lakh people

were covered by Mediclaim. The subscribers are usually from the middle and upper class,

especially since there is a tax benefit in subscribing to Mediclaim.

The standard Mediclaim policy covers only hospital care and domiciliary hospitalization benefits.

Most medical conditions are reimbursed though there are important exclusions, such as pre-

40
existing diseases, pregnancy and child birth, HIV/AIDS, etc. Hospitals with more than 15 beds

and registered with a local authority can be identified as providers.

The amount reimbursed is also uncertain, and the patient is sometimes only partially reimbursed,

usually because the documentation is insufficient. The policy is not automatically renewed and

depends on the timely payment of the premium. The GIC was more interested in whether the claim

was related to an existing disease or whether the facility was qualified or not, but detected fraud

for a short time. With claims exceeding 30% per year, more than household expenditure, it reflects

the problem of moral hazard that requires close monitoring.

Secondly, it was observed that the GIC sets premiums on the filing of claims and not actual

amounts settled, giving it a cushion year-on-year, as the amounts settled are always lower than the

amounts submitted, which remain unadjusted. In 1994, 4.4% of the insured claimed, of which only

75% were solved. The claims ratio was 45%. However, the claims ratio is now increasing rapidly,

allegedly because of collusion between patients, insurance agents and hospitals.

41
Indian Insurance Industry Overview & Market Development Analysis

Fig 3.9 (a) - Indian Insurance Industry Overview & Market Development Analysis

Market Size

The healthcare market can increase three fold to Rs 8.6 trillion (US$ 133.44 billion) by 2022.

India is experiencing 22-25 per cent growth in medical tourism and the industry is expected to

double its size from present (April 2017) US$ 3 billion to US$ 6 billion by 2018.

There is a significant scope for enhancing healthcare services considering that healthcare spending

as a percentage of Gross Domestic Product (GDP) is rising. The government’s expenditure on the

health sector has grown to 1.4 per cent in FY18E from 1.2 per cent in FY14. The Government of

India is planning to increase public health spending to 2.5 per cent of the country's GDP by 2025.

42
Fig 3. 9 (b) Health care growth in India

43
 Fig 3.9 (c) Infographic table Investment

The hospital and diagnostic centers attracted Foreign Direct Investment (FDI) worth US$ 5.25

billion between April 2000 and June 2018, according to data released by the Department of

Industrial Policy and Promotion (DIPP). Some of the recent investments in the Indian healthcare

industry are as follows:

 Healthcare sector in India witnessed 23 deals worth US$ 679 million in H12018.

 India and Cuba have signed a Memorandum of Understanding (MoU) to increase cooperation

in the areas of health and medicine, according to Ministry of Health and Family Welfare,

Government of India.

44
 Fortis Healthcare has approved the de-merger of its hospital business with Manipal Hospital

Enterprises. TPG and Dr. Ranjan Pal could invest Rs. 3,900 crore (US$ 602.41 million) in

Manipal Hospital Enterprise.

Government Initiatives

Some of the major initiatives taken by the Government of India to promote Indian healthcare

industry are as follows:

 On September 23, 2018, Government of India launched Pradhan Mantri Jan Arogya Yojana

(PMJAY), to provide health insurance worth Rs 500,000 (US$ 7,124.54) to over 100 million

families every year.

 “AYUSHMAN BHARAT IS THE LARGEST GOVERNMENT FUNDED IN

HEALTHCARE PROGRAMME IN INDIA”

 In August 2018, the Government of India has approved Ayushman Bharat-National Health

Protection Mission as a centrally Sponsored Scheme contributed by both center and state

government at a ratio of 60:40 for all States, 90:10 for hilly North Eastern States and 60:40 for

Union Territories with legislature. The center will contribute 100 per cent for Union Territories

without legislature.

45
 The Government of India has launched Mission Indradhanush with the aim of improving

coverage of immunisation in the country. It aims to achieve atleast 90 per cent immunisation

coverage by December 2018 which will cover unvaccinated and partially vaccinated children

in rural and urban areas of India.

Achievements

Following are the achievements of the government in the year 2017:

 In 2017, the Government of India approved National Nutrition Mission (NNM), a joint effort

of Ministry of Health and Family Welfare (MoHFW) and the Ministry of Women and Child

development (WCD) towards a life cycle approach for interrupting the intergenerational cycle

of under nutrition.

 As of September 23, 2018, the world’s largest government funded healthcare scheme,

Ayushman Bharat was launched.

 As of November 15, 2017, 4.45 million patients were benefitted from Affordable Medicines

and Reasonable Implants for Treatment (AMRIT) Pharmacies.

 As of December 15, 2017, the Government of India approved the National Medical

Commission Bill 2017, it aims to promote area of medical education reform.

India is a land full of opportunities for players in the medical devices industry. India’s healthcare

industry is one of the fastest growing sectors and it is expected to reach $280 billion by 2020. The

country has also become one of the leading destinations for high-end diagnostic services with

tremendous capital investment for advanced diagnostic facilities, thus catering to a greater

46
proportion of population. Besides, Indian medical service consumers have become more conscious

towards their healthcare upkeep.

Indian healthcare sector is much diversified and is full of opportunities in every segment which

includes providers, payers and medical technology. With the increase in the competition,

businesses are looking to explore for the latest dynamics and trends which will have positive

impact on their business. The hospital industry in India is forecasted to increase to Rs 8.6 trillion

(US$ 132.84 billion) by FY22 from Rs 4 trillion (US$ 61.79 billion) in FY17 at a CAGR of 16-17

per cent.

India's competitive advantage also lies in the increased success rate of Indian companies in getting

Abbreviated New Drug Application (ANDA) approvals. India also offers vast opportunities in

R&D as well as medical tourism. To sum up, there are vast opportunities for investment in

healthcare infrastructure in both urban and rural India.

Exchange Rate Used: INR 1 = US$ 0.0142 as on Q2 FY19

References: Department of Industrial Policy and Promotion (DIPP), RNCOS Reports, Media Reports, Press

Information Bureau (PIB)

https://www.ibef.org/research

47
3.10 - REGULATORY FRAMEWORK

HEALTH INSURANCE SETTLEMENT CLAIMS BY IRDA:

Insurance regulator - Insurance Development and Regulatory Authority (IRDA) has come up with

a separate health insurance claims settlement regulation, which would address issues arising out

of claims not honored by the insurers in a time bound manner. Presently there is no separate

provision for the health insurance claim settlement. The IRDA is working on a draft regulation

and it is expected to be put up on the regulator‘s website for comments and suggestions by April

30, 2012. A public interest litigation was filed by a Mumbai-based insurance activist in February

2011 against IRDA which said ―there are a great deal of inconsistencies and violations in the

health insurance industry, which are directly detrimental to the interests, health and financial

wellbeing of crores of Indian consumers.

The fight between hospitals and insurance companies and their third-party administrators (TPAs)

should not affect consumers, he said. After hearing the petition last month, Chief Justice Mohit

Shah and Justice Roshan Dalvi said in their order, "We expect the IRDA to display the draft

regulation on health care as much as possible on its website. More than 7 crore health insurance

customers currently have a total premium of Rs. Eleven thousand crore. Of the four general

insurers in the public sector, New India Insurance incurred a loss of Rs 422 crore in FY 11 and the

remainder made 76 profits. Only two of the 15 private non-life insurance companies made profits.

The general insurance industry's net loss for the last financial year was Rs 1,019 crore.

There have been number of cases where insurers were accused by the customers for denying,

delaying or reducing claim amounts deliberately. In 2010, the 4 public health insurance companies,

48
having a 60% share of the total market, struck off a large number of hospitals from their Preferred

Partner Network (PPN) in almost all metros. PPN hospitals provide cashless medical facility under

the health insurance policy. Insurers alleged that there were some hospitals who along with the

patients were inflating the medical bills and some TPAs were also involved in this. There is

documentary evidence of some insurance companies providing incentives to their TPAs to lower

the amount claimed by a customer. Experts, however, feel that when there are mechanisms the

IRDA has developed to deal with claims, there is no need for a new set of regulations.

RULES BY IRDA:

 All Health Insurance products henceforth would be renewable for lifetime, without any

renewal ceasing age.

 Grace period for renewal of Health Insurance would be 30 days, before which delay of

renewal could be condoned by the Insurance Company.

 Health Insurance policies from Life Companies would have a minimum term of 4 years,

whereas Non-Life companies could have a maximum term of 3 years.

 Clear procedures specified for smooth migration of children from Floater plans proposed

by their Parents, into their own independent plans.

 Insurers would be required to have policy wordings of all their products mandatorily put

up on their website. (Yes, there are some good companies which don‘t have Policy

Wordings on their portal)

49
  Communication of Denial of Coverage, and Loading on fresh Health Insurance proposals

should be in writing.

Standard Definitions, Exclusions, and Forms (like Claim Forms) are expected to be released by

IRDA.

Renewal Procedure (regarding maximum age, changes in coverage at later ages, upgrading cover,

loading charges) would have to be clearly detailed in the policy wordings

Any change in Terms of the policy at the time of renewal need to be communicated with the

policy holder 3 months before the renewal date.

Insurers are required to mandatorily settle claims within 30 days of submission of complete

documents.

Insurance Companies cannot reject claims on technical grounds of delayed submission, if the

customer can provide valid reasons for the delay caused.

Cashless Cards should be issued within 15 days of issue of the Health Insurance Policy. No

Fresh cards would be issued every year on renewal. The same cashless card would be continued

every year.

Hospital Network would be the responsibility of the Insurance Company, and not the TPA

(which is the case currently) Insurance Companies would be required to make direct agreements

with Hospitals. These agreements could be tripartite with the TPA. In short, Insurance Companies

would administer the network and would be held responsible for issues that arise in the network.

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(Since TPAs were originally brought in to primarily administer the network of hospitals, their role

after these regulations take effect, would be diluted significantly.)

Any Change of TPA in a policy should be informed to customer with 30days of such change. All

data should be seamlessly transferred to the new TPA, ensuring there is no hassle caused to the

customers.

THIRED PARTY ADMINISTRATION:

A Third Party Administrator (TPA) is an organization which processes claims or provides

cashless facilities as a separate entity. Seen as an outsourcing of claim processing, TPA processes

claims for both retail and corporate policies. The risk of loss incurred remains with the insurance

company. The insurance company usually contracts a reinsurance company to share its risk. An

insurance company hires TPA to manage its claims processing, provider network and utilization

review. While some TPA operates as units of insurance companies, most are often independent.

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3.11 - DISTRIBUTION CHANNEL IN INDIA:

In India distribution channel has increase day by day there has been many channel partners like

Agency, Direct marketing, bank assurance, Brokers, Telemarketing, Micro insurance, virtual

marketing but some channel partners are emerging slowly in the market. The Agency, Direct

marketing, Banc assurance, brokers plays an very important role to fulfill the need of the customers

as per their requirement.

Agency and direct marketing channels stable in the market, now many of the banks has started

their own insurance product or they are tie up with the insurance company so the banc assurance

channel now growing in the market , many of the customers maintain their loyalty towards the

company hence they buy only that companies product.

Brokers and the telemarketing is the easiest way to get the product, by setting at home customer

get there product in hand so this is also one of the growing channel in the market.

LEVARAGING THE DISTRIBUTION NETWORK:

 Enhancing customer awareness product innovation to suit different segment of society

rather than one size fits all & Finding New business opportunities.

 Banc assurance channel not capitalizing on the available data base.

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  Agency & Brokers distribution to about 18% of health insurance market focus only on

ubran and group polices & brokers can tap the worksite.

 Marketing opportunities available in virtual marketing activities such as Electronic kiosk

stands, mobile advertising, Internet tap.

IMPORTANT GUIDELINES TO MEET THE NEED OF THE

CUSTOMERS:

 Contact the Insurance division to see if the insurance seller is legitimate , licensed broker

 Read before Sign

 If something is unclear get an Explanation in writing from the agent or company before

signing the Insurance form.

 Get contract in writing. The only guarantee of coverage is in contract

 Ask the agent to Explain thoroughly the policy , the policy ,the coverage and its limits and

conditions

 Check the reports rating, the responsiveness of insurance companies to customer claims

 Get copy of every document you sign as apply for and buy the Insurance policy.

 Keep your receipt and cancelled check.

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  Read your policy as soon as you received it .Be sure that what you received is what you

paid for.

3.12 – FEW KEY PLAYERS OF HEALTH INSURANCE MARKET:

 ICICI LOMBARD GENRAL INSURANCE

 STAR HEALTH & ALLIED HEALTH INSURANCE

 NEW INDIA ASSURANCE

1- ICICI LOMBARD GENERAL INSURANCE:

ICICI Lombard GIC Ltd. is a joint venture between ICICI Bank Limited, India's second largest

bank with consolidated total assets of over USD 91 billion at March 31, 2012 and Fairfax Financial

Holdings Limited, a Canada based USD 30 billion diversified financial services company engaged

in general insurance, reinsurance, insurance claims management and investment management.

ICICI Lombard GIC Ltd. is the largest private sector general insurance company in India with a

Gross Written Premium (GWP) of Rs. 5,358 crore for the year ended March 31, 2012. The

company issued over 76 lakh policies and settled over 44 lakh claims and has a claim disposal

ratio of 99% (percentage of claims settled against claims reported) as on March 31, 2012. The

company has been conferred the "Golden Peacock Award 2012" for Corporate Social

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Responsibility, "Golden Peacock Innovation Award-2010" for Rashtriya Swasthya Bima Yojana.

It also received the "Skoch Financial Inclusion Award-2011" in the micro finance category. The

company has been conferred with 'NASSCOM - CNBC TV18 IT User Award 2010' for Best

Technology Implementation in the Insurance Sector. It has been awarded CNBC Awaaz Consumer

Award 2010 for being the 'most preferred brand' in the General Insurance category. ICICI Lombard

Auto Insurance has been rated highest in customer satisfaction by J.D. Power Asia Pacific in India

among 11 auto insurance providers. It was awarded Customer and Brand Loyalty award in the

'Insurance Sector - Non-Life' at the 3rd Loyalty awards, 2010 and the 'General Insurance Company

of the Year' at the 11th Asia Insurance Industry Awards. The company also won the NDTV Profit

Business Leadership Award 2007 and was adjudged as the most Customer Responsive Company

in the Insurance category at the Economic Times Avaya Global Connect Customer Responsiveness

Award 2006. It has the Gold Shield for 'Excellence in Financial Reporting' by the ICAI (Institute

of Chartered Accountants of India) for the year ended March 31, 2006.

PRODUCT OFFERED:

Family Protect Premier

Health Advantage Plus

 Critical Care

 Personal protect

 Health Care Plus

POPULAR PRODUCT:

Health Advantage Plus-

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Health Advantage which covers not only hospitalization expenses but also outpatient expenses like

dental, up to a limit. Maternity cover is also available under this product. The company has also

added Health insurance Guide, an interactive tool to help the customer Selecta plan to suit his

requirements. Health Advantage Plan has two fixed Premium brackets of Rs. 15,000 and Rs.

20,000 for senior citizens. This ensures that you get the entire Tax benefit.

IMPORTANT FEATURES OF HEALTH INSURANCE:

 A Choice of cover of Rs. 2 lakh and Rs.3 lakh at the same premium rate

 You can avail Outpatient treatments under this policy

 You can cover 2 individuals in the same policy at the same rate.

 Pre-existing illness covered after 2 years

 No pre-screening or medical test till age limit 55

 The premium does not change as per age.

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2) STAR HEATH AND ALLIDE INSURANCE:

STAR HEALTH & ALLIED INSURANCE COMPANY:

Star Health and Allied Insurance Company Limited (Star Health) is a joint venture between Oman

health Insurance Company, ETA Ascon Group and a number of insurance veterans in the country.

It is also the first dedicated health insurance company in India. Known for its innovation, Star has

some very unique products like Diabetes Safe which is for diabetic patients and Star Net plus

which is designed for HIV+ patients. Star Health insurance has an in-house TPA which increases

its efficiency in dealing with cashless cases. They also have a unique feature where in customers

calling a toll free number can get free consultations with a general physician.

Star Health and Allied Insurance Company Limited (Star Health) has a capital base of Rs.438

crores, more than sufficient to form a General Insurance Company. However, Star Health has

chosen to be in the field of Health. It is India's first stand-alone Health Insurance Company in India

and deals in Personal Accident, Mediclaim and Overseas Travel Insurance.

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PRODUCT OFFERED:

 Medi Classic
 Diabetes safe

Family Health optima:

 Star Health
 Senior citizen Red carpet
 Star critical plus

POPULAR PRODUCT:
Family Health optima:

Star Health brings you this Unique insurance policy with unique benefits for - coverage for both

future ailments / diseases and for pre existing diseases / conditions

STAR ADVANTAGES :

 No Third Party Administrator; direct in-house claims settlement

 Faster & hassle-free claim settlement

 Cashless hospitalization

 Network of more than 4900 hospitals across India

 24x7 Toll- free Helpline

 Free General Physician Consultation over phone. Doctors on duty 24x7. By quoting the

policy number, any person can contact our Doctor on the toll free number 1800 425 2255

for medical advices.

 Free Health magazines are issued to policy holders at regular intervals

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 3- NEW INDIA ASSURANCE:

New India is a leading global insurance group, with offices and branches throughout India and

various countries abroad. The company services the Indian. It is one of the first Indian owned

companies when it was formed in 1919. It offers different health insurance products like

Mediclaim policy, senior citizen and universal health insurance policy. New India is a leading

global insurance group, with offices and branches throughout India and various countries abroad.

The company services the Indian subcontinent with a network of 1068 offices, comprising 28

Regional offices, 393 Divisional offices and 648 branches. With approximately 21000 employees,

New India has the largest number of specialist and technically qualified personnel at all levels of

management, who are empowered to underwrite and settle claims of high magnitude. New India

has been rated "A-" (Excellent) by A.M.Best Co., making it the only Indian insurance company to

have been rated by an international rating agency. Rating based on following factors:

Superior Capital Position

Strong Operating Performance

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Only Company to develop significant International operations, long record of successful trading

outside India

PRODUCT OFFERED

 Mediclaim Policy

 Senior citizen policy

 Universal health Insurance

POPULAR PRODUCT:

Mediclaim Policy

We have designed a new Policy called as Family Floater Mediclaim Policy for covering the family

members with one sum insured. All the terms and conditions of Individual Mediclaim Policy

2007 will be applicable for Family Floater Mediclaim Policy

This insurance is available to persons between the age of 18 years to 60 years. The persons beyond

60 years can continue their insurance provided they are insured under Mediclaim policy with our

Company without any break.

MAIN FEATURES MEDICLAIM POLICY:

 Existing policy holders can continue to renew their mediclaim policy till lifelong

 The policy offers an attractive discount in premium for family cover

 Loyalty Discount is offered on continuous policy renewal

 Good Health Discount is provided for claim free years

 Cost of Health Check up is also provided after a certain period of time

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 4. RESEARCH OBJECTIVE AND RESEARCH METHODOLOY

STATEMENT OF PURPOSE
The purpose of this study is to find out the Buying behavior of Health Insurance. We have received

121 respondent what is their view in terms of opting Health Insurance. The number of people with

Health Insurance coverage is low in India. The present study is an attempt to find the cause for

low Health Insurance coverage. The study address the awareness and buying behavior of Health

Insurance and scope of the private Health Insurance companies schemes. Given the growing

interest on the importance of Health Insurance, the outcome of the present study is considered

useful in guiding policy making and to help to knowing the complete process of Health Insurance.

OBJECTIVE OF THE STUDY

 To assess the individual awareness about Health Insurance.

 To know the preference of individual regarding health insurance.

 To evaluate consumption patterns of health insurance.

 To assess the effectiveness of company services

Research methodology

D.Slesinger and M.Stephenson in the Encyclopedia of Social Sciences define the research as “the

manipulation of things, concepts or symbols for the purpose of generalizing to extend, correct or

verify knowledge, whether that knowledge aids in construction of theory or in the practice of an

art.” In short, the research for knowledge through objective and systematic method of finding

solution to a problem is research. The systematic approach concerning generalization and the

formulation of a theory is also research.

61
Research design provides the glue that the research project together. A designed is used to structure

the research to show how all of the major parts of the research project, the sample or group

measurement, treatments and methods of assignment work to gather try to central research

question.

Hence, it is clear that research design is the blueprint for researcher it lays down the methodology

involved in the collection of information and answering at meaningful conclusion from the same.

This classification are made according to the objective of the research ,in some causes the research

will fall in to one of this category but in other cases research will fall in to two categories.

There are two types of methods of collecting data

1. PRIMARY

2. SECONDARY

PRIMARY DATA: The main purpose of collection of primary data was to prepared

questionnaire. The researcher tried to find out the awareness and Buying pattern of Health

Insurance Through:

Personal Approach

 Surveys

 Mails

 questionnaires

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  telephone ,discussion meeting with Managers, Agents of all the four Health Insurance

companies &customers etc. for this project personal interviews was conducted for

collection.

SECONDARY DATA consists of published data collected through

 Books

 Websites

 News papers

 Journals

 Magazines

 Research papers

SAMPLE SIZE: 83 COMPANY NAME SAMPLE SIZE

NEW INDIA ASSURANCE 22

STAR ALLIED HEALTH INSURANCE 08

BAJAJ ALLIANZE 08

MAXBUPA HEALTH 28

OTHER COMPANIES 17

TOTAL 86

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 5. FINDING AND ANALYSIS:

FIG 5.1 HEALTH INSURANCE DATA

Analysis - Out that out of the 124 respondent majority almost 70% of the people are having health

Insurance and 30% of the people do not have Health insurance.

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 Fig 5.2 Reason of not having health insurance.

Analysis: - From the diagram 5.1 above table the people who do not have health insurance the

reason:

 Covered from the company but they would hardly knowing which company do they hold

of

 15% of the people from the 38 respondent are not aware of the health insurance or there

are possibility that they can be covered from any the company they are working for but

don’t know the name of the health insurance company

 Some think that the premium are too expensive but they don’t think one hospitalization can

cost too much where they might need to sell out their belongings.

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Fig 5.3 Health insurance is from which company

Fig 5.4 Your Health Insurance is from

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Analysis: From the table 5.3 and 5.4 there is a large no of people are having health insurance from

both the company but they are from the private players and not from the government companies.

At time of research meeting done with the clients over the phone and face to face meeting people

do not wanted to approach government companies as there is a capping on Room Rent, doctor

fees, Third party payment settlement (TPA). Capping on illness etc

People do not wanted to take or face any kind of hassle during hospitalization or post

hospitalization.

There are few respondent who has the medical policy but are not aware of which company do they

hold.

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 Fig 5.5 Channel wise breakup of health insurance

Analysis : As per the analysis and finding done during the research was that almost 68% people

feel that they should buy or already bought through agents and 14% of the people have bought

online this can be the lot of advertising campaign run for awareness of health insurance.

At the time of the research in the meetings and over the phone call it was understood that they

prefer to buy from the agents who are known to them and can guide about the any insurance to the

point and crystal clear for understanding that what will be paid and what not.

Trust factors are the key role of buying health insurance through the agents or know people who

has got the industry knowledge.

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Others sources are they are covered or taken from the company/banks or through others channels.

Fig 5.6 – How much coverage do you have

5.7 How much premium do they pay

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Analysis: From the fig 5.6 and 5.7 Almost 45% of the respondent have taken health insurance

between 3lacs to 5 lacs where in the premium they are paying somewhere between 10 thousand to

15 thousand for an individual or floater policy.

There are almost 34 % respondent think that the paying premium little high can get them a best

policy and will help their family secured with a decent coverage of 5 lacs to 10 lacs.

There are only 10% of the respondent think that they should have a coverage more than 20 lacs

looking at the medical inflation happening all around and the awareness of the illness happening.

Fig 5.8 Important factors for opting health insurance.

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Analysis : - It is understood that the main concern of the people think before they opt for any

health insurance is they do not want any kind of capping and the claim settlement is the top priority

for them and the services of the company or the agents from which they buy.

It is also understood that the buying a good health plan from a good company and the Agents you

deal with plays an important aspects.

Fig 5.9 Company details

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Analysis: As per the 83 respondent Max Bupa Health Insurance and New India Assurance are the

companies where they have taken their medical policy Over the phone and the personal meetings

done with the random people it is understood that the people are looking out for a simple and basic

plan with almost no terms and conditions applied on their health policy.

As per the respondent they have find the best features with the above companies and have choosen

over them.

Fig 5.10 Experience chart of Health Companies

Analysis: - 31% of the respondent are highly satisfied wiith the current company they deal with

and are happy with the services and 30% are neutral and 7% of the people are highly dissatisfied

due to the capping in the policy, money deducted from an insurance company.

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6. CONCLUSION:

This paper makes an attempt to understand the Study for buying behavior of health insurance.

The result of this study shows that the annual premium is the most important factor that

influences the decision or choice of health Insurance plan. This means that households having

higher income have higher probability of buying healthcare plan. Thus, less income groups

may not opt for health insurance plan. Apart from annual premium, hospital network and

disease coverage or coverage of services hold importance in making choice of healthcare plan.

The decision made for choosing the plan is mainly influenced by self-perceptions.

Most people would prefer to buy healthcare plan from private insurance companies for they

provide better services and innovative products. Thus, there is large scope for private insurance

companies to grow. The analysis clearly shows that the people are willing to go majorly with

the private companies where they can get the best features and best facilities for them.

It is also understood that the awareness of the health insurance have increased with the help on

the current government initiatives why is a need in today’s world looking at the medical

inflation. The Government and all the associated bodies should all offer their support in

spreading health insurance awareness so that Indian citizens are aware of the right to seek

quality healthcare without any financial thought as it will help to increase the awareness of

health Insurance among the people.

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 7. THE GAPS AND IMPROVEMENT AREA IN HEALTH INSURANCE
Health insurance is certainly an expense, but the importance of health insurance does help. It is

best to work with a health insurance agent to help compare plans and costs so that you and your

family can find the best. Remember, medical expenses are higher than ever before, so if you have

to be hospitalized for any reason, your costs are much higher than you might expect. They may be

so high that you cannot pay them, and bankruptcy is your only solution. It doesn't make sense to

bankrupt your financial future just because you didn't buy affordable health insurance.

Think about another health insurance significance. Your family, your family. Your children need

health care throughout their young lives and it seems that children always have to go to the

emergency room. If you look after a family, you have to get health insurance. Without it, your

whole family is vulnerable and would you want to live with the guilt that no health insurance could

create if anything happened? Health insurance cannot be overestimated. Certainly, the money for

individual health insurance can be difficult. But can you really afford to be without it?

This private sector bridges most of the gaps between what government offers and what people

need. However, with proliferation of various health care technologies and general price rise,

the cost of care has also become very expensive and unaffordable to large segment of

population.

The proportion of insurance in health care financing in India is extremely low. Public spending in

health care is very low at 17% and the National Health Policy has recognized this More than 86%

74
of healthcare financing is through unplanned or, non-contributory spending 86% from out-of-

pocket expenses 83% from private sector spending Health care financing in India.

8. BIBLIOGRAPHY

Ellis RP, Alam M, Gupta 1.1996 Health Insurance in India: Prognosis and prospectus Bostan

University: Bostan and Institute of Economic growth :Delhi December 18.

IIMA 1999. Indian Institute of Management, Ahmedabad. Report of Health Inurance in India.

insurance Regulatory and development Authority(IRDA)

Bhat, K & D, Malavankar(2001, Health Insurance in India : opportunities , Challenges , and

concern in Indian health insurance industry : transition and prospect by Srivastava D C new century

publication , New Delhi.

Gumber A, Kulkarni V.2000, Health Insurance for informal sector: case study of Gujrat Economic

and political Weekly, sep 30

Directorate General of Health Services

Dholkia R. Economic reforms: Implications for Health Insurance.

Presentation at one day workshop on ―Health Insurance in India.‘ Indian Institute of

Management, Ahemdabad Oct 30. 1999.

Ramesh Bhat and Nishant Jain (2006), Factor affecting the demand for insurance in macro health

insurance scheme, IIM Ahemdabad.

Berman and M. E.Khan (1993): paying for Indias Health care, New Delhi, sage publication.

H.Sadhak (2009), Health Insurance Care In India ,sage publication, delhi 190

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Jyitsna sethi and nishwan Bhatia(Dec.2008):To study the Type of Health Insurance and Health

Insurance scheme in India, PHI Learning pvt.ltd publication

Anand Ganguly(2012): To studies how manage the health care effect of dreaded dieses,New age

pvt .

M.N. Mishra and S.B .Mishra, To study the environment product design And structured Facilities,

S chand and company pvt ltd publication.

Hima Gupta, (2007) "The role of insurance in health care management in India", International

Journal of Health Care Quality Assurance, Vol. 20 Iss: 5, pp.379 – 391.

Nyman. J.A.(1999). ―The value o Health Insurance: The access Motive‖.

Hopkins S. & M.Kidd(1966). The determinants or the demand for private Health Insurance under

medicare. 191

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BIBLIOGRAPHY

www.google.com

www.mediindia.net

www.healthinsuranceindia.org

www.policybazaar.com

www.timesofindia.com

www.irda.govt.in

www.policymantra.com

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