Use technology to make insurance affordable, says Irdai chairman Panda

High operating and distribution costs and inflated hospital expenses have kept the cost of health insurance products elevated, making them unaffordable for a section of the society, Insurance Regulatory and Development Authority of India (Irdai) Chairman Debasish Panda said on Tuesday.

“We have to look at ways of reducing expenses to make insurance affordable,” said Panda, while addressing the Health Insurance Summit organised by the Confederation of Indian Industry.

The Irdai chairman suggested that advanced technological solutions such as using artificial intelligence for creating tailor-made health insurance products can be the way out.

Panda also nudged the industry to come out with solutions that are pocket-friendly. Often out-of-pocket expenses for consumables become a thorn in the side of the insured despite having a policy.

Panda said while he understands insurance providers’ genuine concerns about providing cover in such cases, something can be done around the risk pool to cover risks. “It is time to ponder and come up with solutions,” he said, adding that the regulator is working on easing the caps on expenses management as demanded by the industry.

Panda said in tier II cities, health insurance providers are not able to sell insurance products because there is inadequate hospital infrastructure, terming it a chicken-and egg situation.

“Insurance companies and hospitals need to work together and investors need to invest in both these sectors,” he added.

Vinod Paul, member, NITI Aayog, emphasised on designing the right health insurance products covering the elderly as well as for people with pre-existing diseases without exclusion. 

Paul said the insurance industry must develop workable products for the missing middle before December, bring transparency in the health care system and expand and speed up penetration of private health care in the country. 

The Aayog in its report titled ‘Health Insurance for India’s Missing Middle’ released in 2021 said that at least 30 per cent of the population, or 400 million individuals — called the missing middle — are devoid of financial protection for health. The report said they have the ability to pay a nominal insurance premium but lack awareness of health insurance, or do not have access to suitably priced products.

Lav Agarwal, additional secretary in the Ministry of Health and Family Welfare, said that the government is in the process of partnering all stakeholders to ensure India enhances its position as a more attractive medical tourism destination.

“The government is building a ‘Heel in India’ portal that will have the details of all accredited hospitals on a common portal to ensure hassle-free experience for the patients. The portal will also help in assessing the quality of service provided to the patient from his arrival up to post-discharge care. The focus has shifted from providing information to providing services and monitoring these services,” he added.