Rural India and Health Insurance
The Indian sub-continent has a majority of its population living in rural areas. In India, over 70% of people in the country live in rural areas, this is a massive market. A market that till now has not been tapped by the insurance industry as heavily as it should be. However, in recent years with the downturn in the market and a drop in investments from the urban areas, insurance companies have begun to invest more heavily into breaking through to the masses in the rural sector. They now sell everything from automobile to health care insurance.
Health care is essentially a right of every citizen, but due to the lack of good infrastructure, lack of access to medication and medical facilities and a dearth of good medical professionals, over 60% of the population in India cannot avail of good health care. The entire 60% is made up of individuals from rural sector where the medical facilities are laughable. However, a number of NGOEUR(TM)s and the Government, have begun to set up medical facilities in areas that have none, ensuring that the professionals hired and the equipment used is the best that it can be.
Even with these efforts, three-fifth of all rural residents needs to travel more than 5 km in order to gain access to good medical care. Due to the lack of public sector health facilities, most patients now go to private practices in order to receive treatment. In a study conducted in 2012, it was discovered that 61% of all rural patients chose to go to private health care providers.
The downside to the private care is that these facilities are almost 2 to 9 times more expensive than public facilities. In fact households that need to contend with chronic illnesses spend almost 44% of their monthly income at private medical facilities for treatment of their ailment. An IMS study points out that another major factor in driving people to private practices is the lack of good transportation and travel infrastructure in the rural areas. This means that households need to choose facilities that are closer rather than those that are more cost effect.
Considering these facts, it becomes clear that individual health insurance and health plans would go a long way in easing the burden of the rural household. If insurance companies can appreciate the difficulties they have, they can create policies that can prove attractive to the market while still maintaining some margin for profit. Considering that 44% of household income is currently being spent on medical expenses, paying anything less even 20% or 25% towards premiums would prove a boon, as it would take care of the remaining medical costs.
Health insurance could grow exponentially if they find a way to tap into this market. All it would require is for the insurance companies to be willing to spend time in instructing the people as to the benefits of having a health plan in place. Once the consumers weigh the pros and cons, the Medical claim market will have a place in the rural sector.
Health care is essentially a right of every citizen, but due to the lack of good infrastructure, lack of access to medication and medical facilities and a dearth of good medical professionals, over 60% of the population in India cannot avail of good health care. The entire 60% is made up of individuals from rural sector where the medical facilities are laughable. However, a number of NGOEUR(TM)s and the Government, have begun to set up medical facilities in areas that have none, ensuring that the professionals hired and the equipment used is the best that it can be.
Even with these efforts, three-fifth of all rural residents needs to travel more than 5 km in order to gain access to good medical care. Due to the lack of public sector health facilities, most patients now go to private practices in order to receive treatment. In a study conducted in 2012, it was discovered that 61% of all rural patients chose to go to private health care providers.
The downside to the private care is that these facilities are almost 2 to 9 times more expensive than public facilities. In fact households that need to contend with chronic illnesses spend almost 44% of their monthly income at private medical facilities for treatment of their ailment. An IMS study points out that another major factor in driving people to private practices is the lack of good transportation and travel infrastructure in the rural areas. This means that households need to choose facilities that are closer rather than those that are more cost effect.
Considering these facts, it becomes clear that individual health insurance and health plans would go a long way in easing the burden of the rural household. If insurance companies can appreciate the difficulties they have, they can create policies that can prove attractive to the market while still maintaining some margin for profit. Considering that 44% of household income is currently being spent on medical expenses, paying anything less even 20% or 25% towards premiums would prove a boon, as it would take care of the remaining medical costs.
Health insurance could grow exponentially if they find a way to tap into this market. All it would require is for the insurance companies to be willing to spend time in instructing the people as to the benefits of having a health plan in place. Once the consumers weigh the pros and cons, the Medical claim market will have a place in the rural sector.
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