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The landscape of the global health insurance industry is consistently changing owing to several factors such as increased competition, entry of new players and instances of collaborations and consolidation.
Over a decade, there has been a consistent growth in insurance premiums due to increasing life expectancy, medical inflation, increasing aging population, more employment opportunities encouraging people to go for an insurance policy and an administrative push for compulsory coverage.
Health insurance is a form of insurance coverage that pays for the cost of the insured individual’s medical expenses. Based on the type of health insurance coverage an individual has, he or she may pay for healthcare-related costs out of pocket and then be reimbursed by the insurance provider, or the insured individual makes payments to the insurance provider.
According to WHO estimates, life expectancy at birth rate was 72 years in 2016, 5.5 years increase as compared to 2000.Life expectancy have also increased due to the availability of better health-care facilities across the world.
However, along with life expectancy, chronic and complex diseases and lifestyle induced health concerns have also increased. All such factors are shifting the current risk landscape in the industry and putting more pressure on the current healthcare system.
As the risk faced by insurers changes, it is necessary for them to improve their operating efficiencies, satisfying the evolving customer needs and align better with the dynamic business environment.
Policy holders are also becoming tech-savvy and requires products and services that are highly personalized to their requirements. They demand similar holistic experience which is offered by other industries like online retail forcing insurers to reassess their product and service strategy.
In several ways, the Coronavirus pandemic is a nightmare, with considerably higher claim costs than those typically associated with infectious diseases and epidemics. Most insurers are also trying to figure out how to correctly forecast the effect on healthcare costs and, as a result, the claims book.
With more people opting to buy health insurance online, the demand for user-friendly digital products is growing. Simplified and uncomplicated policy advantages would need to be accompanied by accurate and easy-to-understand terminologies and product documentation.
This will play a critical role in building confidence and providing a fully digital experience, as well as providing greater access to people of all economic and educational backgrounds.
A survey from the Commonwealth Fund conducted in May 2020 and released on 23 June found that 41% of US respondents who said that they or a partner had lost their job since February had relied on that job for health insurance.
They now have to find a way to pay for insurance or healthcare on their own. As the covid-19 pandemic continues, the dependence on jobs for health insurance premiums is only one of many factors threatening the US health insurance industry. However, although some of its clients are having difficulties, the industry as a whole is doing fine.
While Covid-19 is regarded as a game-changer, it is more likely to reinforce current trends in insurance, such as digitalization and the pivot to Asia, which will evolve faster and stronger as a result of Covid-19.
In 2019, 8.0 percent of people, or 26.1 million, did not have health insurance at any point during the year, according to the CPS ASEC. The percentage of people with health insurance coverage for all or part of 2019 was 92.0 percent.
Private health insurance coverage was more prevalent than public coverage, covering 68.0 and 34.1 percent of the population at some point during the year, respectively. Employment-based insurance was the most common subtype.
In 2021, the average cost of individual health insurance for a 40-year-old across all metal tiers of coverage is $495. This represents a decrease of close to 2% from the 2020 plan year.
While about 58 percent of the US population has private health insurance to take care of their health needs, the debate over whether public or private insurance is more economically efficient seems endless, especially since the institutional reform of the Affordable Care Act (a.k.a. Obamacare) in 2010. Govt health plans in the Medicaid and exchange markets have experienced high levels of enrolment during COVID19.
President Biden signed an executive order that will direct the federal government to open a special enrollment period from February 15 2021 to May 15 2021for Affordable Care Act (ACA) exchanges that serve 36 states. This measure is designed to boost coverage for people who are uninsured. instrumental changes to public programs, including the ACA, Medicare, and public health, are in the offing.
UK insurance industry is the largest in Europe and the fourth largest in the world. Due to the uncertainty surrounding the Brexit problem, the NHS crisis has resulted in an increase in private health insurance sales, pushing up potential demand.
However, in November 2020, national NHS leaders in England published proposals for new NHS structures and legislation. The main aim of the changes – which could be implemented by 2022 – is to support NHS organisations to collaborate to improve care and manage resources.
The cost of private medical insurance (PMI) in the UK continues to increase year on year, with an increase to 6% in 2020 and a predicted increase of 7% in 2021.
As of 2019, the penetration for life insurance in India is 2.82%, and the penetration for non-life insurance is much lower at 0.94%. The country’s individual health insurance penetration is only around 3 percent. COVID-19 aided the common man in making health insurance a priority.
The increase in these policies started in late April and early May 2020, fueled by an increase in COVID-19 incidents. In fact, by July 2020, premium collections had recorded a 40 percent growth. But this is expected to be a short-term surge and sales could drop once the pandemic comes under control.
IRDAI (Insurance Regulatory and Development Authority of India) has taken a number of steps to make it easier for consumers to administer their health insurance plans and file claims.
The regulator has asked insurers to ensure that policy renewal periods are extended, that cashless payments are available, that premiums are paid in installments, that all health insurance exclusions are standardised, and that telemedicine is included in the claim settlement policy.
Customers will benefit from these steps because they will improve service offerings, which will help the sector expand faster. Mergers and acquisitions are now becoming a strategic choice for accelerating business growth. The merger of Bharti Axa and ICICI Lombard, as well as HDFC Ergo’s acquisition of Apollo Munich, demonstrate this.
The global health insurance market size is estimated at $XX Billion in 2020 growing at –% CAGR till 2028.
The global health insurance market is highly competitive due to the emergence of new players in the industry. The majority of health care providers are consistently making developments and applying techniques that aim to boost the infrastructure of the health care market.
These factors will lead to more innovative products that are related to the health insurance products which would drive the growth of the industry in the near future.
The top health care providers are already beginning to make use of advanced technology such as Artificial Intelligence, Machine Learning in order to assist their customers with making decisions while about purchasing various healthcare policies.
Moreover, the government also public healthcare for its citizens in multiple developing countries. This will likely cause several private medical insurance providers to make their way into the market with greater funding mechanisms.
Between 2016 and 2020, the stringent norms related to the regulation of health insurance are expected to boost the size of the market. In order to expand their reach globally, several key vendors will begin focusing on joint ventures, as well as mergers and acquisitions.
There are several companies that are expected to be top vendors in the coming decade. These companies include AXA, Allianz, Aviva, United Healthcare and Zurich Insurance Group, AIA Insurance, the Aetna Foundation and Blue Cross Blue Shield . In addition, the entry of Walmart further makes the industry more competitive.
The insurance industry in general involves players whose products are similar to one another and price is the pivot around which the entire competition takes place.
However ,increasing customer expectations and greater compliance are forcing such companies to rethink about their product offerings to earn better margins and ensure their survival.
One of the major limitation that the health insurance market suffers from is lack of transparency which is critical for building customer trust. However, in most of scenarios, customers are unable to obtain a detailed plan about their insurance policy and whether a particular test is covered or not leading to weak brand loyalty.
In addition, regulations in the United States to improve price and quality transparency is also putting pressure on the companies forcing them to revisit their strategy of building better customer relations.
Another way through which the insurers can proliferate their growth is through AI powered chatbots which can help them to interact with customers in a more efficient way as there has been an increase in an app-based ecosystem and usage of messaging apps.
Adoption of automation technologies would help them boost claim processing efficiency and can enable real time processing. This would also help them to eliminate human errors and poster a customer relationship that is transparent and reliable.
The health insurance market needs to adopt an efficient and digitally integrated ecosystem that would enable them to provide a seamless and simplified customer experience enabling them to survive in the short term and thrive in the long run.
AXA: Axa has made health the centerpiece of its latest strategy, as insurers around the world gear up for a potential uptick in demand after the pandemic..
The company expects to pay out €1.5bn in Covid-related claims.It expected its health and protection insurance revenues to increase 5 per cent a year between 2020 and 2023, thanks to plans to launch “innovative services” such as online health platforms. The insurer already sells about €13bn in health insurance.
Axa’s telemedicine platform is open to other insurers and allows customers to book appointments at speed. Axa is aiming for an underlying return on equity of between 13 and 15 per cent between 2021 and 2023, and underlying earnings per share growth of 3 per cent to 7 per cent over the same period.
AXA International and New Markets (AXA INM) takes charge of AXA’s operations in emerging and developing markets, covering Eastern European territories, Latin America, the GCC (Gulf Cooperation Council), Africa, India, Singapore, Malaysia and more.
There are seven key pillars being addressed in AXA’s strategy: Legacy and technical debt, Cloud, the Partnership and Customer Service ecosystem, Big Data, Innovation and Artificial Intelligence (AI), People Capabilities, and Information Security in AXA’s new operations strategy.
United Health Group: Earnings from operations at UnitedHealthcare jumped from $2.6 billion in the year-ago quarter to $7 billion during the three-month period ending June 30. The profit margin at the health insurance business was about 14%, compared with about 5% in the year-ago quarter.
UnitedHealth Group said its 2021 revenues will reach $277 billion with net earnings to approach $15.90 per share and adjusted net earnings to approach $16.75 per share, next year as the company unveiled its business strategy on December.
The company’s strategy will continue to push a move to value-based medical care models while escalating the use of technology to make sure patients get care that they need when they need it. Patients will get more digital coaching along with advancements in telehealth.
In partnership with Optum, they are making health coverage more affordable through modernized clinical programs, innovative product designs, unrivaled network capabilities and industry-leading practices.
UnitedHealthcare’s Digital Health @Home supports members with chronic conditions by managing their health through condition-specific pathways, engaging providers via telehealth, and providing tools and resources to assess symptoms.
More than 26 million Americans rely on UnitedHealthcare Employer & Individual through its fully insured and self-funded medical plans. Including alliance partners, this business provides medical services for an additional 750,000 people. This includes more than 250,000 employer customers of all sizes, across all 50 states.
