HEALTH INSURANCE MARKET ANALYSIS

The global health insurance market was valued at US$ 2,371.9 Mn in 2022 and is forecast to reach a value of US$ 4,974.5 Mn by 2030 at a CAGR of 9.7% between 2023 and 2030. The global health insurance market is experiencing strong growth due to the rise in global disease burden and rise in patient pool and growing geriatric population around the world. Moreover, the outbreak of COVID-19 (pandemic) and rise in awareness among people about health insurance and associated benefits is expected to boost the market growth. However, factors such as rise in health insurance premium cost and lack of consumer awareness about insurance coverage are expected to hamper growth of the global health insurance market.

Global Health Insurance Market: Regional Insights

Based on geography, the global health insurance market is segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.

Among regions, North America is expected to gain highest share in the market during the forecast period owing to the rising prevalence of chronic diseases, growing geriatric population, increase in awareness among people about health insurance, and the presence of a large number of insurance companies in the region. For instance, Medicaid is a federal and state program that helps people with limited income and resources to cover medical costs, covering benefits normally not covered by Medicare, as nursing home care and personal care services. It is a largest source of funding for medical and health-related services for people with low income in the U.S.

Asia Pacific is expected to witness robust growth in the global health insurance market due to the growing burden of chronic disease, growing geriatric population, the outbreak of COVID-19, and rise in awareness among people about health insurance in the region. For instance, health policy purchases in India are steadily increasing. According to the National Family Health Survey 2019-21 (NFHS-5 survey), around 41% of Indian families have at least one individual covered by the Medical Insurance Plan, up from 28.7% in the previous NFHS-4 study. The Indian population has realized the value of health insurance due to the pandemic.

Figure 1. Global Health Insurance Market Share (%), by Region, 2023

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Global Health Insurance Market Drivers:

Rise in patient pool to underpin market growth

One of the key factors expected to augment the growth of the global health insurance market during the forecast period is the rise in global disease burden and rise in patient pool around the world. Health insurance is a type of insurance that covers medical expenses of the insured due to an illness or accident in exchange for a premium amount. Therefore, with the rise in patient pool, number of health insurance policies is also increasing. In March 2023, Go Digit General Insurance announced the launch of three new plan under the Digit Health Insurance Policy to cater to the newly evolved health insurance needs post the pandemic.

Growing geriatric population to drive market growth

Another factor which is driving the growth of the global health insurance market is the growing geriatric population around the world. For instance, growing geriatric population is responsible for the increasing disease burden worldwide, with a wide patient pool suffering from chronic diseases. Thus, players in the market are launching policies to cater to the geriatrics. The National Insurance Company (India) has launched Varistha Mediclaim Policy for senior citizens who are more prone to suffer from ailments and age-related illnesses. Moreover, the National Programme for the Health Care of Elderly is launched to address and improve the medical issues faced by elderlies.

Global Health Insurance Market Opportunities:

The outbreak of COVID-19 (pandemic) is expected to provide significant growth opportunities for players in the global health insurance market. For instance, the world population has realized the value of health insurance due to the pandemic. People have also timely realized the fact that health policy is the only way to be financially secure during the pandemic. The Insurance Regulatory and Development Authority of India (IRDAI) mandated/instructed health insurers to include COVID-19 coverage in all policyholders' regular health insurance plans. Thus, several insurers have been offering COVID-19 Health Insurance cover in their base plans.

Rise in awareness among people about health insurance and associated benefits is expected to offer lucrative growth opportunities for players in the health insurance market. For instance, customers in rural areas are becoming aware of health insurance comprehensive coverages. In April 2023, Royal Sundaram launched a new campaign called '#Don'tBeAClown' to promote the importance of general insurance, encouraging people to protect themselves and their assets by getting insured, highlighting the need for various types of insurance. A campaign aims to educate the public about the risks associated with not having adequate insurance coverage.

Global Health Insurance Market Trends:

Subsidized health insurance schemes is a recent trend

The health insurance market is growing due to favorable government programs, a good regulatory environment, strong democratic factors, strong distribution channels, new product launches, and new partnerships. For instance, AB PM-JAY is an entitlement-based scheme funded by the Indian government under Ayushman Bharat, aiming to provide INR 500,000 ($6,900) per family per year for secondary and tertiary care hospitalization to over 107 million vulnerable families. This trend is expected to continue over the forecast period.

Customized or personalized policies is another trend

Service providers are focusing on offering customized policies to attract the younger generation to retain their market share along with the growing competition in the industry. Personalized services improve customer experience, retain loyal customers, and attract new customers. Thus, worldwide, service providers are trying to address the demand for customized and/or personalized on-demand insurance. This trend is also expected to continue over the forecast period, driving the growth of the global health insurance market.

Global Health Insurance Market Restraints:

High premium cost to hinder growth of the market

One of the key factors expected to hamper the growth of the global health insurance market is the rise in health insurance premium cost. Health insurance companies have increased the premium cost due to the massive claim settlement and rise in healthcare expenses such as hospital admission charges, cost of medicines, and cost of other treatments. Furthermore, technological advances have led to the development of medical devices and drugs that are extremely expensive, which in turn increases the cost of treatment.    

Lack of awareness to hamper the growth of the market

Another factor which is hampering the growth of the global health insurance market is the lack of awareness among people about coverages included in health insurance policy. Insurance coverage is the primary function of a health insurance policy. People are not aware of the variety of services offered under them. According to the survey conducted in October 2019 by Policygenius, around 27.2% people are unsure about health insurance policy facility in the United States. Therefore, it is important to be aware about health insurance policy or coverage.

Figure 2. Global Health Insurance Market Share (%), by Distribution Channel, 2023

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Global Health Insurance Market Segmentation:

The global health insurance market report is segmented into Distribution Channel, Insurance Type, Coverage, End User, Age Group, and Region.

Based on Distribution Channel, the market is segmented into Direct Sales, Broker/Agents, Banks, and Others. Out of which, Direct Sales Segment is expected to dominate the health insurance market over the forecast period and this is attributed to the increasing awareness among people about health insurance and associated benefits.

Broker/Agents Segment is also expected to witness significant growth in the near future and this is owing to the outbreak of COVID-19 (pandemic).

Based on Insurance Type, the market is segmented into Diseases Insurance and Medical Insurance. Out of which, Diseases Insurance Segment is expected to dominate the market over the forecast period and this is attributed to the rise in global disease burden.

Based on Coverage, the market is segmented into Preferred Provider Organizations (PPOs), Point of Service (POS), Health Maintenance Organizations (HMOs), and Exclusive Provider Organizations (EPOs). Out of which, Preferred Provider Organizations (PPOs) Segment is expected to dominate the market during the forecast period and this is attributed to the rise in preference for preferred provider organization.

Point of Service (POS) Segment is also expected to witness significant growth in the near future and this is owing to rise in preference for point-of-service (POS) plan.

Based on End User, the market is segmented into Group and Individuals. Out of which, Group Segment is expected to dominate the market over the forecast period and this is attributed to the increasing awareness among people.

Based on Age Group, the market is segmented into Senior Citizens, Adult, and Minors. Out of which, Senior Citizens Segment is expected to dominate the market over the forecast period and this is attributed to the growing geriatric population.

Adult Segment is also expected to witness significant growth in the near future and this is owing to high prevalence of chronic/lifestyle diseases.

Global Health Insurance Market: Key Developments

In April 2023, SBI General launched a fully customizable, digital-only health product 'Health Edge Insurance.' The policy offers a single comprehensive plan with nine basic indemnity covers and 18 optional covers, allowing customers to design a tailor-made health insurance policy as per their requirements. It offers customers a convenient and hassle-free experience.

In November 2022, Star Health and Allied Insurance declared the launch of the Star Patient Care Insurance Policy to offer comprehensive health and wellness benefits at a reasonable price. The Policy was developed to close the gap between inpatient hospital costs, which are covered by the health insurance sector, and outpatient costs.

In August 2022, Aditya Birla Capital Ltd. and Aditya Birla Health Insurance Co. Ltd. approved an investment of Rs 665 Crores by Abu Dhabi Investment Authority in the health insurer. The funds will be used to fuel the growth of the health insurer.

In July 2022, Bajaj Allianz Life Insurance and City Union Bank teamed up to provide a range of life insurance solutions to the bank's existing and prospective customers across its 727 branches.

Global Health Insurance Market: Key Companies Insights

The global health insurance market is highly competitive. This is attributed to the rise in patient pool and growing geriatric population, as a result, players in the market are focusing on launching novel products in the market.

Some of the key players in the global health insurance market are Aetna Inc., AIA Group Limited, Allianz, Assicurazioni Generali S.P.A., AVIVA, AXA, CIGNA, Ping an Insurance, and UnitedHealth Group Inc., among others.

*Definition: Health Insurance is a type of insurance that covers medical expenses of the insured due to an illness or accident in exchange for a premium amount. It reimburses bills or pays the medical care provider directly on behalf of patients.