Health Policies Beat Motor In Premium

Mumbai: Health insurance is growing faster than motor policies after the pandemic. The share of health covers in non-life insurance premium has risen to 38% in September from 33% in March, driven by group policies.

Before the pandemic struck, the share of motor insurance was 37%, as against 27% for health insurance. Motor insurance’s share has dipped to 28% in September, and if premium from personal accident insurance were added to health, its share would be even higher at 41%.

Health cover is becoming an irreversible employee benefit despite rising premium, industry executives said. At the same time, the cost of rising healthcare is forcing employers to increase the sum insured, they added.

The premium collected by the non-life insurance industry was over Rs 1.4 lakh crore in the first half of FY24 (April-September 2023), an increase of 14.9% over the year-ago period, data from insurance regulator Irdai showed. The growth was driven by health insurance, where the premium rose by 24.4% to Rs 54,713 crore from Rs 43,981 crore in the previous year.

The premium from health insurance will cross Rs 1 lakh crore this financial year, compared to Rs 90,667 crore in FY23, industry sources said.

Premium from group health insurance has increased by 26.7% to Rs 29,537 crore (see graphic). This segment contributes to nearly 54% of health insurance premiums during the first half of 2023-24. Compared to group health, premiums from individual policies have grown slower at 18.4% to Rs 18,784 during April-September 2023, which is 34% of health insurance premiums. The insurance-backed universal health insurance scheme provided by some state governments has grown by 35%, with the total premium in this segment rising to Rs 5,687 crore.
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