Page 31 - The Insurance Times December 2024

Viksit Bharat - A Vision for 2047 35% of healthcare costs. Gen AI solutions provide quick
responses to policy inquiries and claims support. Col-
As India aims to become a developed economy by 2047, a
robust financial sector is essential and insurance can play a laboration with regulator aims to shorten claims pro-
key role. Although India has made significant progress, in- cessing times from days to instant decisions.
creasing penetration still remains a priority, particularly in Driving Higher Affordability : Insurtechs are leveraging
health insurance with 45% of medical spend still being out of rich customer data to offer personalized, flexible plans.
pocket. Multiple macroeconomic tailwinds are already driv- Bite-sized product designs and innovative payment mod-
ing growth in the industry. The goal is to achieve 100% cov- els further enhance affordability, enabling more individu-
erage for all citizens and reduce out-of-pocket medical ex- als to benefit from health insurance coverage.
penses to less than 10%. India envisions becoming the world's
third-largest insurance market, with over 10 companies in the Profitable Partnerships for Sustainable
global top 50 and more than 100 insurtechs operating at scale. Growth
"India has a bold ambition for a 'Viksit Bharat' by 2047, which As the Insurtech landscape evolves, more than 75% of
requires a stable and resilient financial sector, with insurance insurtech's are prioritizing to building profitable operating
as a key pillar. Health insurance is a primary focus area, as it models. Additionally, over two-thirds are fostering strate-
remains under-penetrated at 0.31%. Moreover, out-of-pocket gic partnerships and expanding into new geographies. The
medical expenses account for 45% of India's health expendi- lines between incumbents and Insurtechs are blurring, with
ture, and only 39% of the population is covered. This high- Insurtechs concentrating on profitable growth and develop-
lights a significant opportunity in the health insurance indus- ing insurance capabilities, while incumbents focus on build-
try. As India aspires to become a developed economy, there ing digital-first capabilities. The ecosystem is expanding
are substantial opportunities across three pathways: higher beyond traditional partnerships to include healthcare pro-
accessibility, increased awareness and trust, and enhanced viders, pharmacies, fitness centers, and diagnostic clinics.
affordability. Insurtechs will play a key role in driving innova- The evolving Insurtech landscape clearly demonstrates that
tion across each of these pathways, supported by the broader collaboration is not just an option, but a strategic impera-
ecosystem." said Vivek Mandhata, Managing Director and tive in achieving Vikshit Bharat - the vision for 2047. Since
Partner at BCG, and Co-author of the report.
inception, as a non profit, IIA has focused on promoting an
Health Insurance - A Key Pathway for ecosystem for collaboration amongst all the participants of
Insurance Penetration the insurance industry. Going forward, we will continue to
strengthen these bridges between various stakeholders ,
The health insurance industry in India has seen strong focus on it as a key pillar of our contribution towards realiz-
growth, driven by rising awareness and expanding channels ing Vikshit Bharat 2047.
through corporates, SMEs, and government initiatives. The
retail segment is growing the fastest at 22% annually, yet The path to inclusive insurance brings forth criti-
the industry remains under-penetrated, with 0.31% pen- cal imperatives and implications for each stake-
etration and 38.5% of lives covered. holder:
This highlights a substantial opportunity for Insurtechs, to Insurtechs need to focus on enhancing profitability and
innovate across three pathways to boost health insurance sustainability by refining operating models, building ex-
penetration: panded ecosystems and developing resilience through
Driving Higher Accessibility: Embedding Insurance robust technology and governance.
through new channels by partnerships with corporates,
SMEs, and affinity networks to reach Tier 2+ cities (e.g., Incumbents should expand offerings, invest in capabili-
Bima Trinity). Leveraging Gen AI to support field teams ties for a digital-first approach and address core indus-
with real-time queries and personalized pitches in ver- try challenges through collaborative solutions.
nacular languages. Improving efficiency of existing Other Key Stakeholders such as healthcare providers,
Bancassurance channels to tap into over 1 lakh pharmacies and fitness centers to invest in new-age ca-
branches and 150 crore accounts across semi-urban and pabilities and foster two-way partnerships to strengthen
rural areas. their offerings.
Driving Higher Awareness and Trust: Expanding cov- Regulator should continue two-way communication and
erage beyond IPD to comprehensive health and collaboration among all stakeholders to promote greater
wellness offerings, including OPD, which accounts for clarity and facilitate the creation of innovation hubs.

The Insurance Times December 2024 29