Clocking a compounded annual growth rate (CAGR) of 20 per cent, India's health insurance premium is likely to cross Rs 32,038 crore by 2016-17, from Rs 13,092 crore recorded in 2011-12, on the back of rising income levels and health insurance premium, says an Assocham study.
"Increase in healthcare costs, rising per-capita incomes, burden of new diseases, health-related risks and high financial burden on the poor are key factors that have contributed towards growth of health insurance market in India," Assocham Secretary General D S Rawat said.
Over 65 per cent of people covered by health insurance sector in India come under the ambit of private companies, whereas public insurance companies account for coverage of only 35 per cent people, according to the study.
While the public sector insurance companies garner maximum share of health insurance premium to the tune of 61.5 per cent in India, private health insurers account for just 38.5 per cent, it said.
Moreover, the study also found that referrals constitute a meagre 0.1 per cent in terms of both the number of policies sold as well as medical insurance premium collected.
The study further suggested to the Insurance Regulatory Development Authority (IRDA) to evolve a mechanism to ensure that private insurance companies do not skim the market by focusing on rich and upper class clients, thereby neglecting the masses.
The success and sustainability of health insurance sector in India will depend upon the development of a strong governance framework, efficient management and monitoring systems along with introduction of cost containing and product improvement mechanisms, the study added.