Examples for the design of chartsindus.org/healthcare/Secientific Sessions/Mr. Tapan Singhel - Health... · e 1 4 Thursday, June 26, 2014 Few Facts India’s healthcare expenditure

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Thursday, June 26, 2014

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Health Insurance: On the cusp of a disruptive change

Tapan Singhel MD & CEO BajajAllianz General Insurance Company Limited

“Leveraging technology for a universal

insurance solution”

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Table of

contents 1 India - Health Insurance Scenario

2 Prevailing Trends

3 Creating Access and Driving Technology

4 Building Effective Direct Distribution Channels

5 Balancing it for the Genuine Customers

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India – Health Insurance Scenario

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Few Facts

India’s healthcare expenditure is only 3.9% of the GDP, as compared to the BRIC nations

62% of the health-care spending in India is self-sponsored

(commercial insurance <5% )

99% of Indians will face financial crunch in case of any Critical Illness

Huge opportunity for Health Insurance

(Financing gap estimated at USD 220bn by 2020)

CAGR for Health insurance in India– 32%

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Present Situation:

Insurance Market growth is currently

driven by the Urban Market

The Potential:

67% of India’s population residing

in the rural areas

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Present Approach – A Critical Evaluation

Low or no awareness about health insurance at all levels

Complicated sales literature

Lack of innovative segmentation in terms of product and pricing

Advertisement focus mainly on tax benefits /discounts

Focus on selling services and not on social well-being

Distribution chain seems inadequate (low awareness about online services)

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Prevailing Trends

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Pricing as a Strategy

Outpatient Coverages

Wellness and Value Added

Offerings

Tax Benefits and Incentives

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But are we heading in the right direction ?

Low Pricing

Tax Benefits

OPD Coverages / Add on

Wellness and VAS

Can it substitute

general awareness ??!!

Sounds enticing – but what

percentage of the indian

population is taxable ??

BUT.. Are we still able to

reach out to the people ??

Good Concept but still-

under utilised ?

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The real need of the hour

• The consequences of not being covered

• The concern for self and family well-being

Build Health

Insurance awareness

• 700mn Indians don’t have access to healthcare facilities

• Healthcare spend less than 1% of GDP

Improving access

to basic facilities

• Collaborative effort between various regulatory bodies

• Capitalize on the new health regulations along with a valid feedback mechanism for insurance companies

Favourable legal

and regulatory

framework

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Creating Access:

Leveraging the available means

and building for the future

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Leveraging on Regulatory Initiatives

Leveraging on the prevailing distribution network across the country

(eg. NGOs, mobile vans, Post Offices, etc)

One such initiative is the model initiated by IRDA – Common Service Centers (CSC)

CSCs operate in rural areas where there is no access to internet

Insurance Companies to market retail health through an SPV network with the help of Rural

Authorized Person (RAP)

Implementation of Electronic Health Record Standards (EHR) by GOI* – MoH&FW**

Better risk management by way of systematic maintenance of health records along with

standardisation

*GOI- Government of India

**MoH&FW- Minister of Health & Family Welfare

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Utilising prevailing distribution channels (eg. Mobile platforms)

87+ crore mobile users in India (35+ crore rural users)

Tie-up with telephone providers – enabling health cover for every mobile user

Instant source of access to over 65% of the population waiting for a solution

Leveraging on the smartphone technology (initial product information, online forms, etc)

Cost effective insurance solutions in the form of mobile banking platforms

This population being KYC compliant, risk can be mitigated

“Insurance companies know that they have to do a better job of managing risk, controlling

expense, and creating new products. Mobile solutions should be an integral part of achieving

these initiatives”

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Further Consolidation – eg. Integration with HIS / EHR

Easy access to patient health records for prompt and accurate decision on claims

Paperless exchange of billing information

Reduction in transaction time hassle free admission / discharge of patients

Transaction level transparency

Systematic and uniform billing template / code

Best in class service to customers making insurance

a great experience

* HIS – Hospital Information System

**EHR – Electronic Health Records

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Building the Future – Internet as an Intermediary

Internet is estimated to constitute 15-20% of the gross direct premium

Internet user base is expected to reach 70% of total TV viewers by 2016

Online shoppers are estimated to account for 30% of internet users

Impersonal internet experience to be bridged by:

- Telephonic interactions ~ Doctor on call

- Chats sessions ~ Solutions at your fingertips

- Audio visual support

“Internet has the potential to be a holistic delivery platform to the end users offering myriads of services at the press of

a button and where all stakeholders come together to the benefit of the end user. A case in point is the gradual success

of the Online Pharmacy model”

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Building effective

Direct Distribution Channels

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“Agents are and will continue to remain the dominant channel for most companies”

“Forward thinking insurers are leveraging distribution channels as one way to capture the opportunities that exist in the fast growing Asia Pacific markets”

“One size no longer fits all approach”

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Optimising existing avenues and exploring further

Target the untapped from upper strata of

society

Cross- selling through

Intermediaries

Virtual Marketing /

Internet

Micro-insurance segments

Tie-up with

Telecom companies

Worksite Marketing

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Distribution Channel Development by country

Source: Deloitte – More than one approach

Country Agency Banc-

Assurance Tele-

Marketing Virtual

Marketing Worksite

Marketing Micro-

Insurance Wealth

Management Takaful

Australia Mature Mature Mature Mature Growing - Mature -

China Mature Growing Emerging Emerging Emerging Emerging Emerging -

Hong Kong Mature Mature Mature Growing Emerging - Mature -

India Mature Growing Growing Emerging Emerging Growing Emerging -

Indonesia Mature Growing Emerging Emerging Emerging Emerging Emerging Growing

Japan Mature Mature Mature Mature Mature - Mature -

Malaysia Mature Growing Emerging Emerging Emerging Emerging Emerging Growing

New Zealand Mature Mature Mature Growing Growing - Growing -

Philippines Mature Emerging Emerging Emerging Emerging Emerging Emerging -

Singapore Mature Mature Growing Growing Emerging - Growing Emerging

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Balancing it for the

genuine customer

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Are we Pricing

it right and

pricing it for

the future?

Insurance Industry:

Lack of adequate member exposure

Customer and Insurance Companies:

Leakages both at the proposal and claims level Healthcare

Providers Tariff:

Low involvement of insurance companies in

finalising tariff

Fraud check and control

Pricing strategy of providers

Non disclosure of material facts

Soft and hard frauds in claims

“Frauds are estimated

at 15% if the health

insurance industry

business”

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Bridging the gap between the key stakeholders

Healthcare Providers:

More transparency in fixing procedure rates

Insurance Companies:

Customer friendly service and better

engagement

Customers:

A greater awareness to avail services resourcefully

CUSTOMER

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Preparing for the

Journey Ahead

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Reach out to

the potential

customers

Empowering

the customers

by providing

access

Leverage

technology

for better

partnerships

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Thank You

Tapan Singhel MD & CEO BajajAllianz General Insurance Company Limited

Documents

Examples for the design of chartsindus.org/healthcare/Secientific Sessions/Mr. Tapan Singhel - Health... · e 1 4 Thursday, June 26, 2014 Few Facts India’s healthcare expenditure