Analysis and Insights from Pricing of Health Insurance
from leading insurance companies in India.
The Health Insurance Price Index has increased by 4.09% in Quarter 3, 2023 compared to the previous Quarter. The percentage change Y-O-Y (Q3-2023 Over Q3-2022) has been 7.80%. This is slightly more or less in sync with the overall inflation in the economy despite the fact that medical inflation is supposed to be higher than overall inflation.
Here are the premium prices from the leading 5 health insurance companies for all categories of age groups recorded in Q3, 2023. An average person of 26 years of age paid INR 9,367 premium annually for INR 5 Lakh sum insured and INR 12,015 premium annually for INR 10 Lakh sum insured for 1 Adult category. Whereas, the average payable premium by a 26-year-old, across categories, was INR 19,768 for INR 10 Lakh sum insured and INR 15,259 for INR 5 lac sum insured.
This highlights the fact that the premium does not increase proportionately with the sum insured. From INR 5 lakh to INR 10 lakh sum insured, there was a hike of only 29.55% in premium compared to a 100% increase in the sum insured.
|Age||Sum Insured||1A||2A||2A+1C||2A+2C||Average Premium|
*Source: Average prices in the above tabular data are determined from the leading 5 health insurance companies in India. These prices are for illustration purposes only. Actual prices may vary from insurer to insurer.
The average premium payable by individuals in the 26-year-old category was INR 17,514, for the 36-year-old category INR 19,856, for the 46-year-old category INR 29,319, and for the 56-year-old category it was INR 46,827.
Unlike term insurance, the person entering a health plan is not insulated by the premium increase that happens due to age or premium inflation. However, entering a health plan at an early age makes sense due to the fact that the chances of getting a coverage increases, and you can accumulate various continuity benefits like an increase in sum assured, premium discounts, restoration benefits, etc.
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The health insurance premium prices are highly influenced by the number of people added to the health insurance plan. A family floater plan lets the policyholder add another member of the family without a major increment in the premium price. According to the Quarter 3, 2023 report, the premium paid for 1 Adult for 36-year old category was 11,146 whereas for 2 Adults of 36-years old was INR 15,965, and the premium paid for 2 Adults and 1 Child of the same age category was INR 19,242 against the sum insured of 5 lakhs.
The family floater plans generally cost less as there is an increase of premium of 43.23% on an average on adding 1 more adult of the same age while the increase is only 20.52% on adding a child to the policy.
The prices & charts displayed above are based on the average premium prices of 5 health insurance companies in India. We have selected five private health insurance companies in terms of their GWP earned as per the data available on their website. (Star Health and Allied Insurance Co. Ltd, ICICI Lombard General Insurance Co. Ltd, Bajaj Allianz General Insurance Co. Ltd, HDFC ERGO General Insurance Co. Ltd & Care Health Insurance Co. Ltd.)
The prices represent the annual premium for each sample customer pertaining to age, coverage type & sum insured in Q3, 2023 (October 23 - December 23). The Insurer's individual rate may vary depending on age, coverage type, health profile, sum insured & add-on riders.
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