Booming Health Insurance in India by RNCOS

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Indian health insurance market has emerged as a new and lucrative growth avenue for both the existing players as well as the new entrants. It represents one the fastest growing and second largest non-life insurance segment in the country. Despite adverse economic environment across the world, the Indian health insurance market continued to post record growth in the last two fiscals (2008-09 and 2009-10). Moreover, as per our estimations, the health insurance premium is expected to grow at a CAGR of over 25% for the period spanning from 2009-10 to 2013-14.

Currently, the market is dominated by public sector insurers, and all the private health insurers put together account for less than half the total health insurance premium written in the country. However, with the fast expanding private health insurers, the trend is to get reversed soon; and in next few years, the market will be dominated by private insurers.

According to our latest research report “Booming Health Insurance in India”, although the Indian health insurance market has seen rapid expansion in the past couple of years, it remains largely underpenetrated because of various shortcomings that must be looked upon. We have figured out some of the critical shortcomings including low awareness, non-coverage of out-patient care & existing diseases, inefficient cost management, product reach in rural areas and weak retail distribution model.

The report provides relevant statistics and in-depth analysis on the Indian health insurance market. It highlights all the emerging trends including the key factors driving the market growth and the key challenges confronted by the industry. The report also identifies what could be the possible growth areas for expansion and gives a detailed overview of the competitive landscape.

Moreover, the report presents industry forecast based on correlation of past drivers, challenges and opportunities for expansion. In this way, the report provides a comprehensive and

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									RNCOS                      Booming Health Insurance in India
Online Business Research
RNCOS                                                                  Booming Health Insurance in India
Online Business Research




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                                   © Booming Health Insurance in India
                                                RNCOS, 2010
                                                  Edition 1.0
                              All rights reserved. This publication is protected
                           by copyright. No part of it may be reproduced, stored
                           in a retrieval system or transmitted, in any form or by
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RNCOS                                                      Booming Health Insurance in India
Online Business Research




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RNCOS                                                                                                  Booming Health Insurance in India
Online Business Research




                                                                 Table of Contents

1.      Analyst View ........................................................................................................................................7
2.      Macroeconomic Analysis...................................................................................................................8
3.      Insurance Market Overview .............................................................................................................12
4.      Health Insurance: An Emerging Market..........................................................................................14
     4.1      Market Structure & Performance................................................................................................14
     4.2      Leading Health Insurers & Market Share...................................................................................17
     4.3      Claims by Disease & Length of Hospital Stay............................................................................19
     4.4      Role of TPAs in Health Insurance Market..................................................................................22
     4.5      Future Growth Potential .............................................................................................................24
5.      Vital Industry Trends ........................................................................................................................25
     5.1      High Healthcare Spending .........................................................................................................25
     5.2      Huge Out-of-Pocket Healthcare Cost ........................................................................................27
     5.3      State-run Health Insurance Programs .......................................................................................28
     5.4      Emergence of Standalone Health Insurers ................................................................................30
     5.5      Health-cum-Life Insurance Products..........................................................................................31
     5.6      Health Smart Cards....................................................................................................................32
6.      Regulatory Environment (Procedure for Registration).................................................................33
7.      Issues need to be Addressed ..........................................................................................................38
     7.1      Coverage of Out-patient Care & Existing Diseases ...................................................................38
     7.2      Inefficient Cost Management .....................................................................................................39
     7.3      Product Reach in Rural Areas....................................................................................................40
     7.4      Weak Retail Distribution Model ..................................................................................................41
8.      Major Health Insurers .......................................................................................................................42
     8.1      Public Sector Non-life.................................................................................................................42
        8.1.1 New India ...............................................................................................................................42
        8.1.2 United India............................................................................................................................44
     8.2      Private Sector Non-life ...............................................................................................................45
        8.2.1 ICICI Lombard........................................................................................................................45
        8.2.2 Bajaj Allianz ...........................................................................................................................46
     8.3      Standalone Health......................................................................................................................47
        8.3.1 Star Health & Allied Insurance...............................................................................................47
        8.3.2 Apollo DKV Health Insurance ................................................................................................48




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RNCOS                                                                                    Booming Health Insurance in India
Online Business Research




List of Figures:

Figure 2-1: Life Expectancy (Years), 2001-2009...........................................................................................8
Figure 2-2: Forecast for Life Expectancy (Years), 2010-2013 ......................................................................9
Figure 2-3: Population Breakup by Gender (%), 2009 ..................................................................................9
Figure 2-4: Population Breakup by Age Group (%), 2004-2009 .................................................................10
Figure 2-5: Forecast for Population Breakup by Age Group (%), 2010-2013 .............................................11
Figure 3-1: Gross Insurance Premium (‘000 Crore Rs), 2007-08 & 2008-09 .............................................12
Figure 3-2: Break-up of Gross Insurance Premium in Life & Non-life (%), 2008-09 ...................................13
Figure 3-3: Break-up of Non-life Gross Insurance Premium (%), 2008-09 .................................................13
Figure 4-1: Health Insurance Gross Premium (‘000 Crore Rs), 2004-05 to 2009-10 .................................14
Figure 4-2: Share of Health Insurance in Gross General Insurance Premium (2004-05 to 2008-09) ........15
Figure 4-3: Health Insurance Gross Premium by Insurers Category (%), 2008-09 ....................................15
Figure 4-4: Health Insurance Gross Premium by Insurers Category (Crore Rs), 2004-05 to 2008-09.......16
Figure 4-5: Leading Health Insurers (%), 2008-09 ......................................................................................18
Figure 4-6: Health Insurance Claims (Crore Rs), 2007-08 & 2008-09 ........................................................19
Figure 4-7: Length of Hospital Stay (Days) & Number of Cases.................................................................21
Figure 4-8: Forecast for Health Insurance Gross Premium (‘000 Crore Rs), 2010-11 to 2013-14 .............24
Figure 5-1: Healthcare Spending (Billion US$), 2004-2009 ........................................................................25
Figure 5-2: Forecast for Healthcare Spending (Billion US$), 2010-2013....................................................26
Figure 5-3: Healthcare Payment by Source (%)..........................................................................................27
Figure 8-1: Share of Health Insurance in Net Premium Income of New India (2008-09)............................43
Figure 8-2: Share of Health Insurance in Net Premium Income of United India (2008-09) ........................44
Figure 8-3: Share of Health Insurance in Total Premium Income of ICICI Lombard (2008-09)..................45
Figure 8-4: Share of Health Insurance in Total Premium Income of Bajaj Allianz (2008-09) .....................46




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RNCOS                                                                                       Booming Health Insurance in India
Online Business Research




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