Health Insurance Premium collection is touching Rs. 129863 crores in 2024-2025

Few years back (2007-2011) we were very enthusiastic about the growth of Health Insurance portfolio. This was especially true during 2007-08, when this portfolio grew by 59.20%. Let us look at the growth figures in the recent year.

We have drawn graph showing the % growth YOY and, it shows that yearly growth figure in % terms is stagnating for last 4 years around 22%. Even at 20.60% for the current year (31 March 2025) we foresee this figure in money terms and will touch Rs 129863 Crores.

Graph Showing % Growth Year Over Year

Graph Showing Growth in Premium

Premium increase by insurers, increase in healthcare costs, stock market meltdown (February 2025) is guiding us towards customer resistance and experts have started talking about fall in percentage (%) growth of health insurance premium.

Let us try to make projections for next 6 years.

We have done this with growth rate of 12%, 20%, 30% & 60%.

Growth Chart if Premium Increases at Varying Rates

The survey of Research & Analysis Wing of Insurance Foundation of India revealed that top most wish of every individual is that- “He should have good health”. No one wishes to have materialistic prosperity of the world with ill health. This wish will support the growth of health insurance industry in the years to come.

If someone asks me- What should be the growth in health insurance premium with which I will be happy? - I will say it should not be 30 % gross but it should be 30 % net (as we have to discount for inflation of 7 % per annum in normal costs and 20 % per annum in health care costs). Let us not be satisfied with meager growth of 12 % or 20 % let us aim for growth of 30 %.

It means we should have growth of 30% year over year and then the figure will touch Rs. 519755 crores by 2029-30. Let us be clear that Health Insurance portfolio of Indian Non-Life Insurance will be No. 1 portfolio for years to come.

Healthy long life is good- Are you prepared?

We are living longer and in few years the average age of Indian citizens will touch 75 years or may be 80 years. Are we prepared to live longer but in a healthy way? Have we planned for our health care in the coming years? Very few persons have planned for health care, the fact is that for many age related treatments like hernia, cataract, hysterectomy, knee replacement a person may have to be hospitalized.

What I find is that majority of people have left this important aspect of their life to Almightily, God, Goddess or Guruji in whom they have 100% faith.

Someone may need cataract surgery at 60 years and someone may need it at age of 65 years. If you are going to live till the age of 92 years then you will definitely need hospitalization 2 to 5 times.

The solution lies in buying good health insurance and too where you smile will get claim support with a smile. Avoid disfeatured policies with large number of sub limits/exclusion clauses.

Are the financial results disappointing?

It is a disappointing thing when we see that large insurance companies are incoming losses.

Why you should buy Health Insurance?

1. Good health is most important thing in your life. When you need health care treatment then you must have it, otherwise the whole world seems to be worth nothing to you.

2. Health care costs are increasing due to

• Normal inflation due to increase in petrol costs, electricity costs, taxation, imposition of new levies/taxes.

• Improvement in medical technology results in availability of new equipment, which is better, more accurate in diagnosis. We have moved step by step from x-ray, digital x-ray, CAT scan, MRI, modern models of MRI. More developments will be coming.

• Development of new/better medicines due to application of Biotechnology/ genetics. As high R+D costs are involved and extensive clinical trials cost lot of time/money therefore their price is definitely on the high side in the beginning.

• Highly skilled doctors/nurses/paramedical staff is attracted by developed countries as a result of which health care providers have to increase compensation level to retain the staff.

• Real estate cost is high and is increasing.

All these points indicate/confirm that costs will go up year by year and you have to be prepared for it. We foresee health care costs to go up by 21% in next year.

Many a times I have come across person telling me- I own 3 flats in Gurgaon and if I needed will sell 1 of that to pay for my medical treatment. Reality is that it does not happen. You won’t sell one bathroom of your flat to pay for knee replacement.

You must have a good health insurance policy to take care of your needs.

Some people say that they will go to government or charitable hospital for treatment, when the need arises.

Recently I came across photograph of Safdarjung Hospital, a very famous hospital in New Delhi

The cost of treatment in this hospital may be less but due to excessive pressure to cater to large number of patients you may have to compromise on many things time you should not be surprised if you have to wait for 6 months for MRI test.

Shortage of ventilators has resulted in a stage that attendants or relatives of patients are being asked to pump manual ventilator to revive patients.

You have to make up your mind whether you will like to have good treatment in a good hospital and that too with dignity or you will like to shorten your life. Choice is yours.

Is loss making portfolio of Health Insurance repelling foreign companies to enter India.

Is loss making portfolio of Health Insurance repelling foreign companies to enter India.

It is learnt that Religare Health Insurance may go in for 100% Indian owned venture as no agreement could be reached with 4 foreign companies, with whom discussions were being held. Reasons can be:-

1) Is it that delay in increase of foreign equity from 26% to 49% is responsible for this.

2) Is it that foreign companies are finding that losing portfolio of health insurance is going to continue for at least 5 years then why not delay the entry in to India. They may enter when the companies have incurred heavy losses and are in a mood to readjust the pricing.

Your comments are invited.