There is a massive, untapped market for health insurance and public sector insurance giant New India declaration is planning to develop a individual product targeting this part, according to company officials.
The company is in the process of developing a no-frills health insurance policy targeting the lower income sector. The product will be launched in three months, said Segar Sampath, deputy general manager, New India Assurance.
There are about 600-700 million people in that segment who do not have any medical coverage. There is a huge market to be captured. We are developing a plain vanilla product with lower premium to meet their needs, said Segar Sampath.
The company at present is studying the market, the affordability levels of the intention segment, the premium payable by them and would try and develop a product with smaller cash and controls to meet their medical emergency needs, he said.
While governments in states like Andhra Pradesh and Tamil Nadu already have medical insurance coverage for those below dearth line, the segment of people just above the poverty line is a huge market untouched and unmet at present, experts say.
There are not many health insurance products tailored for this segment. More than that, health insurance companies have failed to create responsiveness about health insurance to this segment of people, said Meena Nair, vice-president, (India) insure risk management and insurance brokerage services.
While launching the right product with an affordable premium is important to meet their needs, what would also matter is the marketing of these products efficiently to ensure their reach to the target group.
The insurers are probably wary of claims settlement in this segment which could be one reason why they have hesitated to meet their needs. In case of government health insurance programmes, people would know that they could approach the hospitals. But for those just above poverty levels there would be very little knowledge on things like the ways of lodging a claim. The onus lies on the insurance firm to educate them, Nair said.