“It just shows that there is a fear factor among the public so they are finding a lot of value in the Corona Kavach. It’s a short-term policy and relatively cheaper, hence people are buying it in large numbers. Also, not many people have opted for the three-and-a-half-month tenure and most have opted for nine-and-a-half months, as they believe the virus is not going away any time soon,” Alamelu said.
While the lockdown and economic downturn have shrunk both vehicle sales and motor premium collections, they have had an oppposite effect on premiums in the health segment, which have registered a 10.4 per cent rise to Rs 18,415 crore as of July 2020 from Rs 16,674 crore a year ago. In the retail health segment, premiums rose 31 per cent to Rs 7,124 crore as of July 2020 from Rs 5,667 crore last July.
Experts say muted growth in the economy and subdued activity in auto sales are expected to further impact motor insurance
business, while health insurance
will continue its pick-up going forward, with the pandemic creating a renewed interest in health insurance.
That said, there still exists a huge protection gap. It is visible in the number of reported corona claims the insurers have received. While the number of infected cases is touching 2.77 million, insurance claims intimated so far (as of August 18) are about 125,000. This seems to indicate that 96 per cent of the population has not been covered for corona. And, this is true not only true for covid but for other diseases also.
“Out-of-pocket expense is one more aspect of the health protection gap. There is lot of out-of-pocket spending, so much so that it becomes financially unviable for not only below poverty line customers but also for the middle class,” Alamelu said.
“There are other aspects like non-treatment and under-treatment due to limited access and unavailability of services. With the spread of covid in tier-2 and 3 cities, and in villages, the health protection gap has become extremely pronounced,” she added.
But she said there has been a lot of progress in health insurance.
Prior to March 2020, the number of health products that had come out in the past 20 years were about 500. But, between March and now, the number of products approved is about 131, which reflects the urgency of the regulator and the needs of the consumers to which insurers are responding.
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