Millennials' next big concern -- health insurance- Business News

Millennials' next big concern -- health insurance

A survey conducted by Max Bupa Health Insurance company found that millennials - people in the age group of 25 to 35 years - were increasingly curious to understand health coverage

  • August 24, 2020  
  • |  
  • UPDATED   09:25 IST
Millennials' next big concern -- health insurance
Amid the pandemic, the health insurance sector as a whole has achieved an 8 per cent growth in April-June 2020 as compared to that in 2019

Twenty-five-year-old post-doc student from Kolkata Pratik Mukherjee's COVID-19 test result was troubling news. It turned only worse subsequently when private hospital authorities handed a bill of Rs 2 lakh for a day's treatment in the isolation ward. However, he is not alone as reports of exorbitant rates and overcharging continue to surface across India despite the central and state governments' instructions to cap hospital charges for COVID-19-related treatments.

Given the gravity of the situation and the panic surrounding it, an increasing number of people are opting for health insurance as early as possible to protect themselves, their loved ones, and their finances. Insurance firms have witnessed an uptick in health insurance policyholders amid the ongoing crisis. Although inquiries were made from all age groups, young customers, in particular, became increasingly interested in medical cover in the face of this massive health crisis.

A survey conducted by Max Bupa Health Insurance company found that millennials - people in the age group of 25 to 35 years - were increasingly curious to understand health coverage.

Around 63 per cent of this age group made inquiries for health insurance amid the COVID-19 pandemic. This age group, otherwise not much concerned about health insurance, is now keen on buying health insurance to save medical costs.

"We have a significant growth in our younger customers, particularly in the age group of 25-35 years," said Rishi Mathur, Chief Digital and Strategy Officer of Canara HSBC Oriental Bank of Commerce Life insurance.

"Due to COVID-19, consumer behaviour has undergone tectonic shifts and has transformed millennials' perception of the importance of having health insurance in their financial portfolio. The pandemic made millennials realise the meaning of taking care of their health. With the coronavirus cases spiking every day, insurers are seeing many first-time buyers who feel the need for quality healthcare in case of a medical emergency," added Prasun Sikdar, MD, and CEO of the ManipalCigna Health Insurance.

Gurdeep Singh Batra, Head-Retail Underwriting, Bajaj Allianz General Insurance has also experienced the same trend. According to him, when the COVID-19 pandemic began in the country, elderly people became crucial customers as they upgraded their already existing insurances. Subsequently, the traction started coming from millennials, Batra added.

Amit Chhabra, Health Business Head, said that he has also witnessed an increase in awareness in terms of both health and term insurance, across all age groups amid the coronavirus pandemic. However, Chhabra added that millennials have preferred health insurance to term insurance, that's because "death rate among millennials due to COVID-19 is relatively lower than elderly people".

Chhabra also stated, "Almost 70 per cent of our customers are below the age of 45 years for health insurance; 25 per cent, between 45-60 years; and 15 per cent are above 60 years.

Amid the pandemic, the health insurance sector as a whole has achieved an 8 per cent growth in April-June 2020 as compared to that in 2019. During the FY 2018-19, general and health insurance companies collected Rs 44,873 crore as health insurance premium, registering a growth of 21.2 per cent over the previous FY 2017-18. Health insurance premium grew over 20 per cent year-on-year in the past four financial years, according to IRDAI.

According to Star Health Insurance, the firm has witnessed 34 per cent growth between April and June this year. Anand Roy, MD, Star Health Insurance said, "There has been a considerable contribution of young adults opting for health insurance, in this growth".

Roy added, "Individuals in the age bracket of 25-40 years constituted around 29 per cent of the total people who signed up for health insurance in the previous quarter that ended in June 2020."

However, Mathur of Canara HSBC Oriental Bank of Commerce Life insurance said that the focus of youth has been largely on affordable term covers with an increasing trend towards protecting the health and safeguarding against critical illnesses.

COVID-19 health insurance products--Corona Kavach and Corona Rakshak have seen major takers among millennials. Several insurance providers agreed that there has been encouraging inquiries and a surge in COVID-19 related health policies.

Around 80 per cent customers of the Corona Kavach policy are below the age of 45. Bajaj Allianz General insurance's Batra said that "We have witnessed higher inquiries for sum insured falling between Rs 2-5 lakh, considering the treatment expenses for COVID-19. Policy period of six and a half months and nine and a half months have witnessed a higher demand in the market".

In order to attract more and more young adults for health policies, ManipalCigna has launched a digital campaign, "Health Ke Saath, Health Insurance Bhi Zaroori Hai", to gain a greater sense of control over their physical and financial health.

Prasun Sikdar of ManipalCigna added, "Millennials need to understand the fact that comprehensive health insurance cover is as essential as Roti Kapda aur Makaan".

The pandemic has changed people's lives across the world, perhaps forever. Adjusting to the constantly changing 'new normal' has not been easy for anyone. This rising awareness about health protection among millennials is perhaps an unprecedented positive outcome of COVID-19.

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