RURAL PEOPLE’S PERCEPTION TOWARDS HEALTH

INSURANCE SCHEMES

SUBMITTED TO PANJAB UNIVERSITY, CHANDIGARH

IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE DEGREE OF
BACHELOR OF BUSINESS ADMINISTRATION

SUBMITTED TO: SUBMITTED BY:

MS. MEHAK SHARMA AVNEET KAUR
(ASSISTANT PROFESSOR) PUPIN- 14316000636
ROLL NO.16089877

KHALSA COLLEGE FOR WOMEN

CIVIL LINES, LUDHIANA
(2018-2019)

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 ACKNOWLEDGEMENT

If words are considered as a symbol of token and appreciation then let words play
their heralding role of expressing my sincerest gratitude and thanks.
Foremost of all I express my sincere gratitude to ALMIGHTY for bestowing upon
my favors and keeping me in high spirit.
I wish to express her deep gratitude to Ms. Mehak Sharma for acting as a guide
and providing me with continuous support and guidance. This report could not
have been always remaining grateful to her.
I am highly thankful to all the people directly related and the students for being
cooperate without whose help this project would not have been proven meaningful.

Avneet Kaur

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 CERTIFICATE

This is to certify that the project entitled to “Rural People’s Perception Towards Health
Insurance Schemes” embodies the work carried out by Avneet Kaur, (14316000636) herself
under my supervision and that it is worthy of consideration for evaluation.

Ms. Mehak Sharma

(Assistant Professor)

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 DECLARATION

I hereby affirm that work presented in this project report entitled to “Rural People’s Perception
Towards Health Insurance Schemes” is exclusively my own and there are no collaboration
does not contain any work for which degree or diploma has been avoided by any other university
/ institution.

Dated:
Place: Avneet Kaur

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 TABLE OF CONTENTS

Chapter Chapter Name Page

No. no.
1. INTRODUCTION 1-20
2. REVIEW OF LITERATURE 21-27
3. RESEARCH METHODOLOGY 28-29
4. DATA ANALYSIS AND INTERPRETATION 30-45
5. FINDINGS , SUGGESTIONS AND CONCLUSION 46-50
ANNEXURE-I i
ANNEXURE-II ii-iv

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 CHAPTER-1
INTRODUCTION

Insurance is a legal agreement between two parties i.e. the insurance company (insurer) and the
individual (insured). In this, the insurance company promises to make good the losses of the
insured on happening of the insured contingency.

The contingency is the event which causes a loss. It can be the death of the policyholder or
damage/destruction of the property. It’s called a contingency because there’s an uncertainty
regarding happening of the event. The insured pays a premium in return for the promise made by
the insurer.

Types of insurance policy:

Health insurance
Health insurance is bought to cover medical costs for expensive treatments. Different types of
health insurance policies cover an array of diseases and ailments. You can buy a generic health
insurance policy as well as policies for specific diseases. The premium paid towards a health
insurance policy usually covers treatment, hospitalization and medication costs.

 Car insurance

In today’s world, a car insurance is an important policy for every car owner. This insurance
protects you against any untoward incident like accidents. Some policies also compensate for
damages to your car during natural calamities like floods or earthquakes. It also covers third-
party liability where you have to pay damages to other vehicle owners.

 Education Insurance

The child education insurance is akin to a life insurance policy which has been specially
designed as a saving tool. An education insurance can be a great way to provide a lump sum
amount of money when your child reaches the age for higher education and gains entry into
college (18 years and above). This fund can then be used to pay for your child’s higher education

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expenses. Under this insurance, the child is the life assured or the recipient of the funds, while
the parent/legal guardian is the owner of the policy.

Home insurance
We all dreaming of owning our own homes. Home insurance can help with covering loss or
damage caused to your home due to accidents like fire and other natural calamities or perils.
Home insurance covers other instances like lightning, earthquakes etc.

Health insurance means “an individual or group purchasing health care coverage in advance by
paying a fee called premium.” In its broader sense, Health insurance is a contract between the
insurance company and the insured person to cover the medical cost that might arise from illness,
accidental injuries, surgeries and other medical complications incurred by individuals and
households. Health Insurance in INDIA got huge potential for expansion. But it continues to
grapple with low growth rate of health insurance in rural areas. Nearly 68% of India's population
resides in rural areas. But percentage of persons having covered under any health insurance
scheme is 14.1% in rural and 18.1% in urban areas, Health Minister Shri Jagat Prakash Nadda
said in a written reply in the Lok Sabha. He said that according to information received from
Insurance Regulatory and Development Authority of India (IRDAI), 28.80 crore people were
covered under health insurance policies provided by public sector and private sector during
2014-15.

“Health is the level of functional or metabolic efficiency of a living organism”. The above
definition is quite understood by doctors or health experts. So what is Health in general sense?
What health mean to a common man? We can say “Health is merely the absence of disease or
infirmity” and we can also say “good health involves healthy life style, health mental attitude and
healthy ways of relating to all living beings and nature.” In modern world we deeply value good
health, yet we have created a society and way of living so out of balance that damage to our
long-term health is the inevitable result. To overcome such damage we take medical support
which again created a financial problem for us.

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Well, we all know for every problem there is a solution and here Insurance is the one. Insurance
is a form of risk management which is used primarily to hedge against the risk of a contingent,
uncertain loss. Insurance is defined as the equitable transfer of the risk of loss, from one entity to
another, in exchange for payment. The basic principle of pooling of risks of unexpected costs is
the main objective of Insurance system. And Health Insurance is the insurance that covers cost of
medical and surgical expenses of an individual. Health insurance is an important means to
finance health care needs of the people. Health insurance has emerged as one of the fastest
growing insurance sectors in India, yet there are people who are still unaware of what benefits
health insurance policies can provide them.

India has traditionally been a low spender on health care. In terms of India’s share in global
health expenditure it is only 4 percent of the world’s total health expenditure (WHO). Even
though there are many companies trying to support to the Indian health infrastructure, India’s
health insurance market still lags behind other countries in terms of penetration. Indian Health
Insurance sector majorly concentrated towards the urban population and the rural mass has been
neglected since the beginning where nearly 69% of Indian population lives.

Expenses towards health issues are the cause of rural indebtedness after agriculture. Major
portion of the country’s poor are facing financial deficit to meet costs of health care. Due to this
they are coming under the clutches of private lenders or need to sell their properties. This
problem of huge out of pocket expenditure can be tackled through Health Insurance and it shows
the necessity of health insurance to the rural people.

Health is most dominant subject which requirements to be specified matter of greatest

importance. There is nothing is our life that is more valuable than good health. There is very
common and true saying that health is wealth. If we are not healthy, wealth means nothing to us.
So, our health is a real wealth. We should always try to be healthy. The term health insurance
(universally known as Medial Insurance) it is a kind of insurance that covers all aspects of
medical expenses risk. In other words health insurance is an insurance policy that ensures that
you get cashless treatment or expense reimbursement in case you fall ill. Fundamentally health
insurance policy is a contract between an insurer and an insured person and contract is renewable

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per annum. Health insurance policy is to compile confident that insured person to prevail the
requisite cure as per contract. The health insurance is significant because the safeguard peace of
mind, eliminate all the (worries) about medical treatment expenses and prevails focusing energy
on more important things like acquiring improved better live and well-being. Health is a major
concern on everybody’s mind in the present environment. The awareness of health insurance has
been extensive, enlarging new dimensions and preferable mechanism to finance the health care
services in India. India is expected to rank amongst the top three healthcare markets in terms of
incremental growth by 2020 and India was the sixth largest market globally in terms of size in
2014. The total market size of the insurance sector in India is projected to touch US $ 350-400
billion by 2020. Indian health insurance industry is growing at a 15 percent compounded annual
growth rate reach US $ 158.2 billion by 2017. The Indian healthcare industry is expected to
register a (CAGR) of 22.9 percent during 2015-20 to US $ 280 billion.

Rising income level, great health awareness, increased precedence of lifestyle diseases and
improved access to insurance would be the key contributors to growth. The private sector has
emerged as a vibrant force in India’s healthcare industry, lending it both national and
international repute. It accounts for almost 74 percent of the country’s total healthcare
expenditure. Telemedicine is a fast emerging trend in India, major hospitals (Apollo, AIIMS.
Narayana) have adopted telemedicine services and entered into a number of public private
partnership (ppp).

The Government of India aims to develop India as a global healthcare hub. It has created the
National Health Mission (NHM) for providing effective healthcare to both the urban and rural
population. There is terrible need of health insurance in India as the world bank report exhibits
that 85% of the working population in India do not have Rs. 5,00,000 as instant cash, 14% have
Rs. 5,00,000 instantly but will subsequently will face a financial crunch, only 1% can afford to
spend Rs. 5,00,000 instantly and easily and 99% of Indians will face financial crunch in case of
my critical illness. Hence the need for health insurance in India cannot be overlooked. During the
last 53 years India has developed a large Government health infrastructure with more than 3601
Ayush hospitals, 1,96,312 No. of hospitals in India, 1,56,926 sub health centres and808 medical
colleges in India.

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By recognising this need the Government of India as well respective State Governments have
taken initiation and created various health schemes to cater the health need of rural people. And
private Insurance companies are also contributing to this cause.

Hence to know the effectiveness of these schemes it is required to understand the awareness of
rural people towards health insurance scheme provided by the Government as well as private
insurance companies.

EVOLUTION OF HEALTH INSURANCE

The concept of Health Insurance was proposed in the year 1694 by Hugh the elder Chamberlen
from Peter Chamberlen family. In 19th Century ³Accident Assurance´ began to be available
which operated much like modern disability insurance. This payment model continued until the
start of 20th century. During the middle to late 20th century traditional disability insurance
evolved in to modern health insurance. Today, most comprehensive health insurance cover the
cost of routine, preventive and emergency health care procedures and also most prescription
drugs. Healthcare in India is in a state of enormous transition, increased income and health
consciousness among the majority of the classes, price liberalization, reduction in bureaucracy,
and the introduction of private healthcare financing drive the change.
Over the last 50 years, India has achieved a lot in terms of health insurance. Before
independence, the health structure was in dismal condition i.e. high morbidity, high mortality
and prevalence of infectious diseases. Since independence, emphasis has been put on primary
health care and made considerable progress in improving the health status of the country. But
still, India is way behind many fast developing countries such as China, Vietnam and Sri Lanka
in health indicators. Health insurance, which remains highly underdeveloped and less significant
segment of the product portfolio is now emerging as a tool to manage financial needs of people
to seek health services.

The new economic policy and liberalization process followed by Government of India since
1991 paved the way for privatisation of insurance sector in the country. The Insurance
Regulatory and Development Authority (IRDA) bill passed in Indian parliament is the important

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beginning of changes having significant implications for the health sector. Health Insurance is
more complex than other segments of insurance business because of serious conflicts arising out
of adverse selection, moral hazard, unavailability of data and information gap problems. Health
sector policy formulation, assessment and implementation are an extremely complex task,
especially in changing epidemiological, institutional, technological and political scenario. Proper
understanding of Indian health situation and application of principles of insurance, keeping in
view the social realities and national objectives are important.

IMPORTANCE OF HEALTH INSURANCE

Medical urgencies can give goosebumps to an average middle-class person. Considering the
increasing inflation, treatment of even the basic diseases are becoming out of reach. Thankfully,
we have reached an advanced level of technology and science where almost every disease can be
cured. However, any surgery or remedy can leave a dent in the pocket. We often get alert when
we meet with such unforeseen situation.

There are many diseases like Heart Attacks, Strokes, Cancer, Kidney failures etc that needs
immediate attention. As soon as any of our close relative including us are attacked by these
deadly diseases we get panic attacks. More than the illness it's the stress of recovery that bothers
us. All these can be managed if we have suitable Health Insurance plan. In absence of it, we
surely can invite many other additional psychological ailments

A health insurance policy, commonly known as mediclaim in India, comes in picture to cover
your expenses up to a great extent and help you retain the peace of mind. Health insurance plans
will be there to support you financially in case of medical emergencies. It will provide the
required financial assistance through which you will be able to pay for all medical bills.

The benefit of cashless treatment makes it more awesome as under the same you can completely
focus on treatment without worrying about the medical bills. A health insurance policy will
allows you to get the treatment at top hospitals of India and the best thing is that the insurance
company will take care of all medical bills.

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At PolicyX.com, which is an IRDA approved website, you can freely compare and select the best
plans to take care of your health needs and expenses in just a few minutes.

The importance of health insurance can never be undervalued for the following reasons:
 Provides security to human life which is of prime importance to any individual.
 Closely bonds insurance companies, hospitals, policy holders and third party
administrators (TPA) together for the benefit of Indian masses. ™
 An answer to the solution of uncertainties and risks are prevalent and ever pervading in
human life.
 Prevention and minimisation of unforeseen losses. ™
 Access to quality health care.
 Means of savings and a safe investment option. ™
 Provides financial stability in life. ™
 A tax saving instrument that significantly contributes in reduction of tax. ™
 Reduces tension and stress caused on account of hospitalisation. ™
 Greatly contributes in leading a stress free life.

DIFFERENT TYPES OF HEALTH INSURANCE

People have their own choices and needs and to cater them insurance companies are offering
multiple forms of health insurance. It is important to invest in a health insurance plan but it is
more important to go for an appropriate cover that can easily go well with your needs.

So for choosing the right one, you should first learn how many forms are there that you can
explore. Following are major types of health insurance policies available in India.

1. Individual Health Insurance

One of the basic health insurance plans that every person must have is an Individual health
insurance. Though it covers a single person but there's always flexibility of availing the sum
assured. Family members can also be chosen easily but we need to pay a separate amount. The
premium that we pay annually is dependent on the amount of sum assured.

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2. Family Floater Health Insurance

Family Health Insurance is best suited for an individual willing to cover more than one family
members. All the family members can enjoy the benefit of the entire sum assured. It's rare
situation when any 2 members of the family fall ill simultaneously. As a result, complete amount
of policyholder, the sum assured can be utilized by a single member. The amount of premium
paid for such kind of policies is quite less as compared to other plans. Members that can be
easily covered is your spouse, children who are dependent and the parents.

3. Critical Illness Plan

Under the same, the policyholder will be liable to receive a fixed benefit payout in case any
critical illnesses specified under the policy. With the lump sum benefit you will be able to pay
the hospitalization cost.

4. Senior Citizen Health Plan

The plan is designed especially for the old age people, particularly the age above 60 years. This
plan is a great to fight against medical contingencies during old age. As per the IRDAI
regulations, every insurance company must include people up to age of 65 years.

5. Maternity Health Insurance

Nowadays, almost every health insurance company cover pre and post natal care, child deliveries
and sometimes vaccination expenses of new born babies as well. In short, it provide cover to all
your maternity expenses. However, features and exclusions can vary from insurer to insurer.

6. Unit Linked Health Plan (ULHP)

Health insurance companies have recently introduced ULHPs. It is basically a combination of

health insurance and investment. Along with the health protection, ULHPs will help you in
building a corpus which can be used by the investor to meet expenditures that do not get covered
under health insurance plans. The return, of course, depends upon the market conditions at that

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time. But these plans are still in the development stage and are recommended for those who can
handle products like unit linked insurance plans (ULIPs) and unit linked pension plans (ULPPs).

Key Advantages & Features of Health Insurance Policy

We all are aware of the fact that the healthcare cost is rising day by day and our earnings are not
able to deal with any big medical emergency. With such rise in the healthcare industry, it become
important to own an appropriate health insurance policy that would be able to deal with such
drastic medical emergencies which can easily create a hole in anyone's pocket.

A comprehensive health insurance plan is all what we need. With the understanding of following
features, buying an effective health insurance plan will become easier for you.

● Cashless Treatment

India is going digital and you can see such changes in the healthcare industry as well. Nowadays,
people do not prefer to carry cash. In case of hospitalization if you own a health insurance policy
with the feature of cashless facility, then you don't have to worry about the payment of medical
bills as the insurance company will pay the same on your behalf and allows you to have
complete focus on your treatment. It will be a big help in case of hospitalization as you do not
have to arrange funds during medical emergency and can pay more attention towards the
treatment.

● No-Claim Bonus (NCB)

No claim bonus or NCB refers to the amount that you will receive from insurer for every
claimless year. It motivates a lot of policyholders to not file any petty medical claims. You
should keep in mind that NCB comes as a discount on the payable premium at the time of
renewing policy or whenever you want to increase the sum assured amount. At the time of
renewal you must check that you are getting your no claim bonus or not.

● Family/Loyalty Discounts

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It is a discount that you will receive on enrolling family member or any person in the health
insurance policy. It is a form of reward that insurance company pay to existing policyholder on
referring people to them.

● Round-The-Clock Customer Support

There is no doubt that the concept of insurance policy seems difficult for a few people. To
provide more ease to them and to solve their queries, all health insurance company provide 24/7
customer service.

● Sum Assured Restoration

It is a matter of concern for many people that their existing health insurance policy will get
exhausted if a person from their family is critically ill. To provide ease to them and to offer
optimum use of their sum assured, insurance companies offer sum assured restoration benefit.
The benefit of sum assured restoration is that once the sum assured amount is completely used,
the insurance company will restored the amount automatically any you don't have to pay any
additional cost for it. Usually, health insurance plans with restoration benefit are expensive as
compared to normal health insurance policies.

● Online Application and Renewal Facilities

As discussed above, India is getting digital and so the insurance companies. These days'
insurance companies have their online presence. All of them own websites and updated the same
regularly to stay in touch with their customers, to make new ones, to sell and to introduce new
insurance products. With such great services, it become easier for a customer to buy new plan
within few seconds from the comfort of your home and can also renew the existing one.

● Free Health Check-Ups

To motivate all policyholders towards a healthy life, insurance companies offers free medical
check-up facility once in a while. Depending on the company and the type of policy that you
hold, you may be eligible for a master health check-up.

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● Lifelong Renewability

Whenever you are planning to buy a health insurance policy you should always look for this
feature. It is vital for you to go for a policy that offers protection for a very long time, especially
during old age. This is the reason why most of the health insurance plans come out with the
facility of lifelong renewability. Just to keep your policy active, you have to renew the same at
end of every policy term.

● Co-payments/deductibles

While buying a health insurance policy, you will see an option of co-pay. At the time of claim, if
the policyholder has opted for co-payment, then he/she will pay a pre-agreed percentage of the
claim amount and the insurance company will take care of rest of the claim. The sum assured
amount under your insurance policy will not be affected by co-payments.

● Tax Benefits

No doubt, it is a plus point of investing in a health insurance plan. On buying any insurance
policy you will be liable to receive tax benefits and the same thing is here with the health
insurance plan. With a health insurance policy, you will get tax advantages for the premiums
under Section 80D of the Income Tax Act, 1961.

● Portability

Usually, we tend to change our insurance provider and switch to new company which is offering
better plans and benefits. Under the same, the policyholder will be allowed to switch from one
insurer to another. The plus point is that you don't have to compromise with the waiting period or
any other features and benefits that you are receiving with the existing the insurer

Health Insurance Claims Settlement Process

Most people, though aware of how TPAs work, don't know how health insurance claims are
settled. Once a mediclaim policy is sold, the TPA takes up the baton from insurance company.
For claims settlement, the policyholder must approach the TPA for all verification and
formalities. TPAs settle claims in two ways.
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● Cashless

You can avail cashless treatment facilities only in the networked hospitals of the insurance
company. The TPA must be notified beforehand in case of a planned hospitalization, or within a
specified timeframe in case of an emergency. The hospital's insurance desk helps with all the
paperwork. The TPA has to approve the mediclaim amount and the hospital will settle it with the
insurer. There are likely to be exclusions i.e. expenses that the TPA won't pay. Such expenses
must be settled by the patient party directly at the hospital cash counter.

● Reimbursement

The insurer can avail the reimbursement facility both at networked and non-networked hospitals.
Here, you can avail treatment facilities and settle the bill directly with the hospital. You can then
claim reimbursement of the expenses from the TPA by submitting the relevant bills and receipts.

Dos and Don'ts of Health Insurance

Here is a list of dos and don'ts you should keep in mind when purchasing a health insurance
policy:

Dos Don'ts
Fiest understands your health insurance Don't be underinsured or over-insured. Go
needs and they go for a customized plan. for an adequate health cover which is enough
There are basically 4 types of policies; to get the needful assistance on time.
mediclaim, critical illness, hospital cash
benefit, and surgical benefit plan. Go for
a plan that suits you
Read the policy document thoroughly. Don't go for a plan just because of it cheap
Check out all inclusions and exclusions premium. It may not offer your sufficient
of the policy. Exclusions may include coverage to cover all your insurance needs.
pre-existing conditions. The waiting
period for certain illnesses can be 3 to 4
years.
You can go for customized health Don't let your policy lapse. Make sure to
insurance plan that goes well with your renew the policy on time. Don't delay in
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 needs. Hence, pay the premium only making payments by a day.
after the insurance provider accepts your
proposal. You can negotiate or opt out
of policies with co-payment or sub-
limit.
Check the list of network hospitals. You Don't conceal pre-existing situations.
don't want yourself to be stuck with a Disclose any pre-existing illness you may
medical facility that offers basic have to avoid policy termination or hassle
healthcare when making a claim. Concealing facts or
furnishing falsified documents gives the
insurance provider the right to terminate
your policy.

GROWTH OF HEALTH CARE SECTOR

A combination of demographic and economic factors is expected to bring about increased

healthcare coverage in India which is expected to drive the growth of the sector.

DEMOGRAPHIC FACTORS
Increase in Population: Expected increase in population from about 1.1 billion in 2009-2010 to
1.4 billion by 2026.

Shift in demographics: 60 percent of the population in the younger age bracket and an expected
increase of geriatric population from current 96 million to around 168 million by 2026 (KMPG
analysis 2011). This represents a huge patient base and creates a market for preventive, curative
and geriatric care opportunities.

Rise in disposable income: Households in the above INR 200,000 per annum bracket can
benefit from an increase in disposable income from 14 percent in 2009-2010 to 26 percent in
2014-2015 making healthcare more affordable (CRISIL 2010). The rising standard of living
along with increased purchasing power and willingness to pay for quality healthcare has led to

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the emergence of high quality corporate hospitals. Changing lifestyle patterns has created a
market for preventive and curative care opportunities.

Increase in incidence of lifestyle-related diseases: There is likely to be a marked increase in

the incidence of lifestyle-related diseases, such as cardiovascular, oncology and diabetes, when
compared to the communicable and infectious diseases.

Rising Literacy: Growing general awareness, patient preferences and better utilization results
increase in literacy rates.

Benefits of Health Insurance Policy

Benefit depends on the policy you choose and the coverage it provides. Here is a list of basic
coverage provided by most of the health policies.
1. It helps securing a better future by paying a little as an expense today called the premium.

2. It reduces saving huge amount of financial losses, risk of financial breakdown in case of
expensive medical and post-illness care.

3. It definitely induces a sense of security to the insured.

4. It provides financial security to the family members.

5. It covers your hospitalization and medical bills.

6. It also covers disability and custodial bills.

7. You can avail tax benefits on the premium paid under section 80D of the Income Tax
Act.

8. The best factor, you can also opt for health insurance policies even after the age of 60.

The health insurance market covers very smaller part of the total population (about 10%) in
India. At present scheme like Voluntary health insurance schemes or private-for-profit schemes;
Employer-based schemes; Insurance offered by NGOs / community based health insurance, and
Mandatory health insurance schemes or government run schemes (ESIS, CGHS) are found in
India.
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According to the statistics of the World Health Organization (WHO), in 2011, India has spent
only 3.9 per cent of gross domestic product (GDP) on the health sector which is the lowest
amongst the BRICS (Brazil, Russia, India, China, South Africa) member countries pack.
Moreover, amongst the BRICS nations, in 2011, Russia’s out-of-pocket expenses stood highest
at 87.9 per cent closely followed by India (86 per cent), China (78.8 per cent), Brazil (57.8 per
cent), and South Africa (13.8 per cent). On the other hand, these expenses in developed
economies of US and UK were comfortably poised at 20.9 per cent and 53.1 per cent
respectively.

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HEALTH INSURANCE SCHEMES BY GOVERNMENT OF INDIA
The central and state government of India has come out with several health insurance schemes
just to improve the healthcare access for the unorganized sectors and for those who come under
the Below Poverty Line (BPL) category. Here is a list of health insurance schemes provided by
the government:

● Ayushman Bharat:

Ayushman Bharat is basically a National Health Protection Scheme that will provide coverage to
10 crore poor and vulnerable families. It means it will provide coverage to 50 crore beneficiaries.
Under the same, a cover of around 5 lakh rupees per family per year for secondary and tertiary
care hospitalization will be there. This effective health programme will subsume the current
centrally sponsored schemes - Rashtriya Swasthya Bima Yojana (RSBY) and the Senior Citizen
Health Insurance Scheme (SCHIS).

● Rashtriya Swasthya Bima Yojana (RSBY):

This helpful scheme launched by the Ministry of Labour and Employment just to offer the
needful health insurance coverage especially for BPL families. All the beneficiaries under this
plan can easily avail hospitalization whenever it requires the cover of up to Rs.30,000. To get
enroll under this effective health insurance plan, there is no specific age limit and you will be
liable to get the cover of pre-existing diseases from the day 1 of the policy. This plan is designed
in a way that can offer the coverage to maximum 5 members of the family that includes spouse,
children, and dependents. Beneficiaries have to pay only Rs.30 as registration fee. Rest of the
premium will be paid by the central and state government to the insurance company.

● Pradhan Mantri Suraksha Bima Yojana:

There is no doubt in saying that accidents are an unfortunate occurrence that does not
discriminate against people on the basis of rich and poor. However, in India accident insurance
are simply doing great with the rich and middle class as well. The one who suffers the most is the
poor section of the society, who are unable to afford an effective and adequate health insurance

21
policy. To provide ease to the poor section, the government has come out with this effective
health insurance plan called Pradhan Mantri Suraksha Bima Yojana. The plan offers great
coverage at affordable premiums and offers compensation to the family of the deceased or if the
policyholder has been disabled partially or permanently following an accident.

● Central Government Health Scheme (CGHS):

This insurance policy was launched the same in 1954 in New Delhi. It is now available in CGHS
covered cities like Allahabad, Bhopal, Chandigarh, Ahmedabad, Lucknow, etc. It offers the
needful comprehensive health coverage to all the central government employees and pensioners.
Dependents of these employees are also included as long as they reside in the CGHS cities. The
insurance policy provides coverage against domiciliary care, specialist consultation facilities,
laboratory tests, hospitalization, and health education to beneficiaries.

● Aam Aadmi Bima Yojana (AABY):

It is basically a social security scheme that was launched in October 2017 just to provide the
needful healthcare facilities to all the rural and landless households. The head of the household
or the earning member of the family will be covered under the scheme. The insurance premium
of Rs.200 per year is paid by the central and state government. The beneficiary should be
between 18 to 59 years of age. An add-on benefit under the policy comprises of scholarship for
children of the nominee. The beneficiary will receive Rs.30,000 upon natural death of the
policyholder member, Rs.75,000 upon accidental death or permanent disability, and Rs.37,500
on partial permanent disability.

● Janashree Bima Yojana (JBY):

This insurance policy was launched in 2000 on 10th August. It replaced the Social Security
Group Insurance Scheme (SSGIS) and Rural Group Life Insurance Scheme (RGLIS). This
policy is specially designed for those people who come under the BPL category and slightly
above BPL category in 45 occupational groups covered under the scheme. Some of the
occupations that would be liable to get the cover are Beedi workers, carpenters, power loom
workers, cobblers, handicraft artisan, agriculturists, construction workers, etc. Aam Admi Bima

22
Yojana and Janashree Bima Yojana have been merged into one scheme and called as Aam Admi
Bima Yojana since 2013.

● Employment State Insurance Scheme (ESIS):

Again a social security scheme that is designed especially to offer the socio-economic protection
to the working class and their dependents. The policyholder and his family who will receive
complete medical care from day one. Under the policy, the beneficiary will receive cash benefits
in times of sickness and temporary or permanent disablement that leads to the loss of earning
capacity. This policy will also be covered by the policyholder's dependents as if the dependant is
disabled on the job, a monthly pension called the dependent benefit is provided under the ESI
scheme. The scheme is applicable to non-seasonal factories, theatres, shops, restaurants, hotels,
road motor transport undertakings, and newspaper establishments employing more than 20
people. Recently, private medical and educational institutions employing more than 20 people in
certain states and union territories have also been included under the scheme.

● Universal Health Insurance Scheme (UHIS):

A new health insurance plan that is specially designed to provide needful healthcare services to a
wide area of the country and to cover poor section effectively. Under this plan, beneficiaries will
receive reimbursement for medical expenses up to Rs.30,000 and accidental death cover up to
Rs.25,000. This policy is there for the BPL families only. The insurance premium for this
scheme is Rs.200 per person, Rs.300 for a family of 5, and Rs.400 for a family of 7. The four
public sector/government health insurance companies in India are The New India Assurance Co.
Ltd, United India Insurance Company, National Insurance Co. Ltd, and Oriental Insurance.

23
RURAL INDIA HEALTH SCENARIO

Majority of rural India people lives below poverty line and they are not capable of affording the
expenses on medical needs. Health insurance is a tough task for these people. The condition of
illness not only deprived them from earning but also pushes them into deep debt. The overall
expenditure on health in India is 4.1% of GDP in which the government contribution is only 1%.
With a low spending on health from government in thickly populated country like India force
people to move towards the costly, unaffordable private sector. Today, India has most privatized
health system in the world with 72% of health expenditure made in private sector that presently
treats 78% of outpatients and 60% of inpatients. If we talk about insurance than it has been
estimated that only 15% of total Indian population is covered under it. To cope with the high
charging medical needs a high number of people coming below the poverty line as they cannot
meet the expenses made for medical needs.

Health insurance can play a crucial role in preventing people from burden of debts. Insurance can
provide them support at the time of emergency and needs. Indian government has introduced
many health insurance schemes for rural people during past years with affordable prices so that
they can be covered by insurance without much burden on them. Insuring people can also leads
to a better health access. Along with the government policies, several non-government
organizations (NGO) also introduce many schemes for the people living below the poverty line.

Healthcare Access in Rural Communities

Access to healthcare services is critical to good health, yet rural residents face a variety of access
barriers. A 1993 National Academies report, Access to Healthcare in America, defined
access as the timely use of personal health services to achieve the best possible health
outcomes. A 2014 RUPRI Health Panel report on rural healthcare access summarizes additional
definitions of access with examples of measures that can be used to determine access.

Ideally, residents should be able to conveniently and confidently access services such as primary
care, dental care, behavioral health, emergency care, and public health services. According
to Healthy People 2020, access to healthcare is important for:

24
  Overall physical, social, and mental health status

 Disease prevention

 Detection, diagnosis, and treatment of illness

 Quality of life

 Preventable death

 Life expectancy

Rural residents often encounter barriers to healthcare that limit their ability to obtain the care
they need. In order for rural residents to have sufficient access, necessary and appropriate
healthcare services must be available and obtainable in a timely manner. Even when an adequate
supply of healthcare services exists in the community, there are other factors to consider in terms
of healthcare access. For instance, to have good healthcare access, a rural resident must also
have:

 Financial means to pay for services, such as health or dental insurance that is accepted by
the provider

 Means to reach and use services, such as transportation to services that may be located at
a distance, and the ability to take paid time off of work to use such services

 Confidence in their ability to communicate with healthcare providers, particularly if the

patient is not fluent in English or has poor health literacy

 Trust that they can use services without compromising privacy

 Belief that they will receive quality care

25
 CHAPTER-2

REVIEW OF LITERATURE

Browne and Kim (1993) identified the factors that lead to the variations in life insurance
demand across nations. Important factors found in their study were dependency ratio, national
income, social security provided by government, inflation, education level, average life
expectancy, price of insurance and religion. The findings that life insurance is positively
correlated with national income and negatively correlated with inflationary expectations,
suggested that economic development and economic stability greatly increase life insurance
consumption.

Saibaba et al. (2002) studied that the perception and attitude of women towards life insurance
policies. The study found that women feel that their lives were not as valuable as their husbands,
they perceive insurance as a tool for risk coverage and not as a tax saving device, there was also
lack of knowledge about suitable insurance plans.

Asgary, Willis, Taghvari and Refeian (2004) estimated the demand and willingness to pay for
health insurance by rural households in Iran and outcomed that a significant percentage of
population (more than 38%) lives in rural areas, but the health care insurance currently operating
in urban area.

Ahuja and De (2004) Confirmed that the demand for health insurnace is limited where a supply
of health services is inadequate.

Reddy (2005) In this article studies that the customer perception towards life insurance
companies policies. This study was limited to Banglore city only. The research concluded that
majority of respondents feel that policies offered by private companies were up to their
expectations but when compared with public companies policies very few policies were better
alternatives.

26
Ahuja and Narang (2005) provided an overview of existing forms and emerging trends in
health insurance for low income segment in India and concluded that health insurance schemes
have considerable scope of improvement for a country like India by providing appropriate
incentives and bringing these under the regulatory ambit.

Reddy (2005), in this article studied that the customer perception towards life insurance
companies' policies. This study was limited to Bangalore city only. The research concluded that
majority of respondents feel that policies offered by private companies were up to their
expectations but when compared with public companies' policies very few policies were better
alternatives.

Rajesham and Rajender (2006) also discussed the changing scenario of the Indian insurance
sector. They point out the challenges in the present situation as growing India's share in the
global insurance market, having qualified, skilled actuaries, dispersion in rural markets, rising
personalized policy for clients etc.

B.Reshmi et al. (2007) in their research stated that the middle and low socio-economic groups
are a potential market to be tapped as they are ready to spend a reasonable amount as premium
payable. The private insurance players should try to earn trust in the people as most of the
respondents preferred government health insurance schemes. And to develop a viable health
insurance scheme, it is important to understand people’s perceptions and develop a package that
is accessible, available, affordable and acceptable to all sections of the society.

Frank and Enkawa (2009), in this article found that how economic processes influence
customer satisfaction. The study examined the separate impacts of economic growth and
economic expectations on perceived value, quality expectations and customer satisfaction. The
results had shown a strong correlation between economic expectations and (overall and industry-
specific) quality expectations.

Sbarbaro (2010) indicate that the lower income level group is the group that faces the maximum
health related issues.

27
Selvakumar (2010) suggested that the insurance companies are targeting semi urban areas and
rural areas with an aim to differentiate themselves from others. They also suggested that
insurance companies are focusing on risk mitigation and protection.

Bawa & Ruchita (2011) in this article they found that as for as there is lower level of awareness
for health insurance. In addition to that people have less willingness to join for health insurance.

Baal N. and Sandhog H. S. (August 2011), a study on Life Insurance Corporation of India
(LIC) the capital demanding business, supplies the most important financial instruments to
customers directed at safety as well as long term savings. The present study by examines the
parts affecting agent’s perception towards Life Insurance Corporation of India. Moreover,
analysis of one way arrangement has also been performed to test the important results to show
that no important differences exist among various groups of respondent regarding to their
apprehension towards Life Insurance Corporation of India.

Sharma M. and Vijay T. S. et al (January 2012), the animus of this study is to assay the brunt
of demographic factors on the level of satiety of investor’s contra insurance policies. The study
entraps the impact of demographics factors on the satisfaction of investors towards insurance
policies. This paper also evaluates cogent relationship between demographic factors and overall
satisfaction of the customers towards the insurance policies.

Babu P. R. (February 2013) in his study by, on the private sector life insurance companies have
been making briskly clump in terms of increasing their augmentation and market share since year
2000. The Indian life insurance system is having cogent base on mixed economic system where
in the public sector engaged a monopolistic position in life insurance business. Private players
play an extensive aspect in life insurance business more energetic and customer friendly.

Purusothaman U. R. (July 2013) has said that India has extensively been known for the
divergence of its culture, for the amplitude of its people and for the accessibility of geography.
Its basin of technical skills, its base of an English speaking populace with an increasing
disposable income and its blooming market have all co adjure and accredit India engrosses as an

28
operable partner to global industry. Hence, the study revealed that India ranks fifth on the overall
index, as the number of points is more desirable on the country economy development index and
the real estate market index, but fairly low on the regulatory index.

G. Kasirajan (2012) in this study he found the consumer behaviour towards health insurance,
majority of the care being provided by the private sector.

Jangati Yellaiah (2012) concluded in their study as the determinants of awareness of health
insurance were: religion, type of the family, education, occupation, annual income. Higher
education and higher annual income increase awareness of health insurance. The health
insurance companies should come out with clear cut policy details, as many of the respondents
had vague ideas about the various benefits and risks involved in a policy. It is important to
understand people’s perceptions and develop a package that is accessible, available, affordable
and acceptable to all sections of the society.

Valentin, E. C., Degnan, and R. D., & Ntaganira, J., (2012) justify the need for a special focus
required for Indian Health Insurance. The major stimulators in availing health insurance are the
tax rebate, security (both  nancial and health), risk coverage, health leverage, out of pocket
expenditure, neutralizing rising healthcare cost.

Nilay Panchal (2013) he found that respondent’s knowledge and confidence about health
insurance was good. In this article he exihibitly indicated that there were clear possibilities for
health insurance market in India and respondents plays a vital role for purchasing health
insurance.

Maheshkumar L choudhar et al. (2013) in their research highlighted that awareness regarding
health insurance is poor (57.25%); therefore awareness creation is needed. Education, socio-
economical status and occupation were favourable determinants for opting health insurance.
Reason for opting for health insurance was mainly related to medical care and financial aspects.
Media seemed to have played an important role in dissemination of information. This calls for

29
effective information, education, and communication activities which will improve
understanding of insurance by the public.

Nilay panchal (2013) concluded that respondents’ knowledge and confidence about health
insurance was good. Further research shown that awareness about the existence of health
insurance was fine but liking is average. Most respondents’ know about health insurance but
some of them don’t have any policy because of low awareness or lack of information regarding
health insurance. Research concluded that there were clear possibilities for health insurance
market in India; there were also possibilities for the public and private health insurance
companies, come of respondents plays a vital role for purchasing health insurance.

Anand Thakur and Sushil Kumar (2013) Examined Understanding the low penetration in the
Indian Health Insurance Industry (presently 32%) and leading MNCs of the world were
venturing aggressively into this sector. It is further endorsed by the fact that India spends only 6-
7 % of GDP on Health care. A comparison of health care spending patterns between India and
developed countries approve the same, as only 5 % Indians avail the same. In Canada and the
UK, Health care is free of cost. While in India, complete coverage is still not accessible, despite
bulky premium payment. The present paper critically evaluates the marketing strategies of
leading players in the Indian Health Insurance Sector. Further, some useful marketing
Implications (with the special focus on STP and marketing mix) have been suggested at the end.

B. Muthukrishnan et al. (2013) in their report mentioned that there is an immense need for
massive propaganda to develop consciousness among the people regarding the need for financing
health care in context of high out-of-pocket expenses on health. If we can successfully use
insurance in covering our health hazards we might create a headway in front of the entire south-
east Asia to come up with a solution to this formidable challenge to the society.

Nisakorn Phichitchaisopa and Thanakorn Naenna (2013) results found that the factors with a
significant effect are performance expectancy, effort expectancy and facilitating conditions. They
were also found to have a significant impact on behavioral intention to use the acceptance
healthcare technology. Also, in Thai provincial areas, positive significance was found with two

30
factors: social influence on behavioral intention and facilitating conditions to direct using
behavior. Based on research findings, for healthcare information technology to be widely
adopted and used by healthcare staffs in healthcare supply chain management, the healthcare
organizational management should improve healthcare staffs' behavioral intention and facilitate
conditions.

Suman Goel (2014) in her study she suggested the awareness of health insurance and
willingness to join in subscription of health insurance.

Prakash N. and Sugumaran G. (January 2014), in their research work stated that India which
has a behemoth population abominable and are not tapped by life insurance market, which in
turn concocted an favourable circumstances for the Indian and foreign nationals to entrust in this
market. For the customers of the private sector, the apical mean value to egress the customer’s
needs and wants.

Jothi A. L. (December 2014), after the privatisation of Indian insurance industry, exhaustive
competitive environment came into live and companies commenced selling manifold product
mix to allure the customers and accomplish their needs and clinch satisfaction through
customer’s positive apprehension. The aim of this research study by is to interrogate whether
demographic characteristics have impress on the perception of customer towards the quality of
services performed by life insurance players.

B.Ramakrishna Goud et al. (2014) in their study highlighted awareness regarding health
insurance is low among households of rural India. The prevalence of Health Insurance among
rural India is so and is dominated by Community Based Health Insurance. Most Popular Health
Insurance Scheme was Yeshaswini insurance scheme. Effective information, education and
communication activities will improve understanding of insurance by the public and hence help
in developing a market for health insurance.

Sinha, A. (2014) studies life insurance industry in India which had its birth in the early part of
the nineteenth century. For better management of the insurance business, several Acts have been

31
passed from time to time. Two noteworthy events in the history of life insurance are (i) the
formation of the Life Insurance Corporation of India in 1956, which served as a monopoly till
the year 2000 followed by (ii) the opening up of the insurance sector to the private players in
1999, who were given the permission to operate either single-handedly or as a joint venture with
any other private player(s) and/or foreign partner.

Niran R. Joshi and Suraj M. Shah (2015) found that the fact there was only unsatisfactory
researches commence with the customer’s perception toward health insurance.

World Health Organization (2016) have considered health insurance an important source to
achieve universal health care coverage.

32
 CHAPTER-3
RESEARCH METHODOLOGY

OBJECTIVES
 To understand and examine the awareness level and sources of awareness about health
insurance.
 To evaluate the variety of health insurance preferred by the respondents.
 To identify the purpose of taking health insurance.
 To assess the perception of health insurance policy holder.
 To examine the barriers in the subscription of health insurance.
 To determine the willingness to join and pay for health insurance

RESEARCH DESIGN:

The nature of the research is exploratory. The exploratory research is research conducted for a
problem that has not been studied more clearly, intended to establish priorities, develop
operational definitions and improve the final research design.

SAMPLING TECHNIQUES:

Convenience sampling technique was used for selecting the sample size. The selection of the
sampling unit is based on convenience of the researcher.

SAMPLE SIZE:

A sample of 100 respondents was selected for the purpose of research project.

TYPE OF DATA:

Primary data was used for the purpose of collection of data.

Primary data has been collected directly from sample respondents through questionnaire and
with the help of interview.

33
DATA COLLECTION TECHNIQUES:

A structured non-disguised questionnaire was prepared for collecting data from the respondents.
The questionnaire included important aspects such as reasons for not having a back account,
problem faced by beneficiaries opening a bank account and benefits given by the banks.

TECHNIQUES FOR ANALYSIS:

Percentage, Mean, Bar Graphs and Pie charts were used for data analysis.

Area of Study: Ludhiana City.

34
 CHAPTER-4
DATA ANALYSIS AND INTERPRETATION

1. Gender of the respondents

Table No.1: Gender of the respondents
Gender No. of respondents %age
Male 63 63%
Female 37 37%
Total 100 100%

Fig. No.1: Gender of the respondents

37%

Male
Female
63%

Interpretation:
The above pie chart represents the gender wise composition of survey respondents. This
suggests that out of 100 respondents 63 were males and 37 were females in the survey.

35
2. Age of the respondents
Table No.2: Age of the respondents
Age Male % Female %
Less than 30 years 23 23% 9 9%
30-40 years 35 35% 21 21%
40-50 years 3 3% 4 4%
Above 50 years 2 2% 3 3%
Total 63 37

Fig. No.2: Age of the respondents

40%
35%
35%

30%

25% 23%
21%
20%

15%

10% 9%

5% 3% 4% 3%
2%
0%
Less than 30 years 30-40 years 40-50 years Above 50 years

Male Female

Interpretation: The above Table classifies the respondents to their age group, the
majority of the respondents belongs to the age group less than 30 years with 23% male
and 9% female, followed by age group of 30-40 years in which 35% male and 21%
female, 40-50 years with 3% male and 4% female and above 50 years with 2% male
and 3% female.

36
3. Marital status of the respondents
Table No.3: Marital Status of the respondents
Marital Status Male % Female %
Single 19 19% 9 9%
Married 44 44% 28 28%
Total 63 37

Fig. No.3: Marital Status of the respondents

50%
45% 44%

40%
35%
30% 28%
25%
20% 19%

15%
10% 9%

5%
0%
Male Female

Single Married

Interpretation: The above Table shows that 19% male and 9% female are single and
44% male and 28% female are married.

37
4. Type of Family
Table No.4: Type of family of the respondents
Marital Status Male % Female %
Joint 51 51% 27 27%
Nuclear 12 12% 9 9%
Total 63 37

Fig. No.4: Type of family of the respondents

60%
51%
50%

40%

30% 27%

20%
12%
10% 9%

0%
Male Female

Joint Nuclear

Interpretation:

The above bar graph shows that 51% male and 27% female belong to joint family and
rest of 12% male and 9% female belong to nuclear family.

38
5. Educational Qualification of the respondents
Table No.5: Educational Qualification of the respondents
Educational M % F %
Qualification
Matric 30 30% 13 13%
Higher secondary 27 27% 17 17%
Graduation 9 9% 5 5%
Post graduation 3 3% 2 2%
Total 63 37

Fig. No.5: Educational Qualification of the respondents

35%
30%
30%
27%
25%

20%
17%
15% 13%

10% 9%
5%
5% 3% 2%
0%
Matric Higher secondary Graduation Post graduation

Male Female

Interpretation:
The above bar graph shows that 30% males and 13% females are matric, 27% males and
170% females are higher secondary, 9% males and 5% are graduate, 3% males and 2%
are post gradudate.

39
6. Occupation of the respondents
Table No.6: Occupation of the respondents
Occupation Male % Female %
Self employed 15 15% 9 9%
Labour 34 34% 5 5%
Housewife 0 0% 18 18%
Unemployed 9 9% 0 0%
Professional 5 5% 4 4%
Total 63 37

Fig. No.6: Occupation of the respondents

40%

35% 34%

30%

25%

20% 18%
15%
15%

10% 9% 9%
5% 5% 4%
5%
0% 0%
0%
Self employed Labour Housewife Unemployed Professional

Male Female

Interpretation:
The above table classifies that out of 100 respondents, 15% males and 9% females are
self employed. 34% males and 5% females are labour, 0% males and 18% females are
housewife, 9% male and 0% female are unemployed and 5% male and 4% female are
professional.

7. Monthly Income
Table No.7: Monthly Income
Monthly salary M % F %
40
Nil 9 9% 18 18%
Less than 15000 17 17% 9 9%
15000-25000 19 19% 7 7%
25000-50000 11 11% 3 3%
Above 50000 7 7% 0 0%
Total 63 37

Fig. No.4: Monthly Income

20% 19%
18%
18% 17%
16%
14%
12% 11%
10% 9% 9%
8% 7% 7%
6%
4% 3%
2%
0%
0%
Nil Less than 15000 15000-25000 25000-50000 Above 50000

Male Female

Interpretation:
The above bar graph showed that 9% male and 18% female respondents had no income,
17% male and 9% females are having income of less than 15000, 19% males and 7%
females having 15000-25000, 11% male and 3% female had income of 25000-50000 and
7% male and 0% female had income of above 50000.

41
8. Do you know about health insurance?
Table No.8: Know about health insurance
Options M % F %
Yes 41 41% 29 29%
No 22 22% 8 8%
Total 63 37

Fig. No.8: Know about health insurance

45%
41%
40%
35%
30% 29%

25% 22%
20%
15%
10% 8%
5%
0%
Male Female

Yes No

Interpretation:
The above bar graph shows that 41% male and 29% female know about health insurance
and 22% male and 8% female don’t know about health insurance.

42
9. What are the sources of information about health insurnace?
Table No.9: Sources of information about health insurance
Options M % F %
TV 15 15% 5 5%
Newspaper 9 9% 2 2%
Agents 5 5% 1 1%
Family 11 11% 19 19%
Friends 23 23% 10 10%
Total 63 37

Fig. No.9: Sources of information about health insurance

25%
23%

20% 19%

15%
15%
11%
10%
10% 9%

5% 5%
5%
2%
1%
0%
TV Newspaper Agents Family Friends

Male Female

Interpretation:
The above graph shows that 15% male and 5% female got to know about health
insurance through TV, 9% male and 2% female know about through Newspaper, 5%
male and 1% female know about agents, 11% male and 19% female know about through
family and 23% male and 10% female know about health insurance through friends.

43
10. How much do you care about having a health insurance policy?
Table No.10: Care about Health insurance policy
Options M % F %
Very much 27 27% 6 6%
Not much 36 36% 31 31%
Total 63 37

Fig. No.10: Care about Health insurance policy

40%
36%
35%
31%
30% 27%
25%

20%

15%

10%
6%
5%

0%
Male Female

Very much Not much

Interpretation:
The above bar graph shows that 27% male and 6% female care about health insurance
policy very much, 36% male and 31% female care about health insurance policy not
much.

44
11. Are you willing to purchase health insurance policy?
Table No.11: Willing to purchase health insurance policy
Options M % F %
Ready to buy 1 1% 5 5%
Still need some time 7 7% 3 3%
Not ready to buy 21 21% 11 11%
No response 16 16% 13 13%
Buy only if certain 9 9% 5 5%
conditions will fulfill
Total 63 37

Fig. No.11: Willing to purchase health insurance policy

25% 21%
20% 16%
15% 13%
11%
9%
10% 7%
5% 5%
5% 3%
1%
0%
l
y e
bu
y se fil
bu e tim
o on f ul
to yt p ll
y so
m d re
s wi
ad a s
Re ee
d
t re No on
ll n No diti
n
Sti co
in
erta
c
if
nly
yo
Bu

Male Female

Interpretation:
The above bar graph shows that 1% male and 5% female are ready to health insurance
policy, 7% male and 3% female still need some time, 21% male and 11% female are not
ready to buy, 16% male and 13% female gave no response and 9% male and 5% female
can buy only if certain conditions will fulfill.
12. Do you agree that the services provided by the insurance companies are delivered
effectively?

45
 Table No.12: Effectiveness of services
Options M % F %
Yes 15 15% 8 8%
No 25 25% 12 12%
Don’t know 23 23% 17 17%
Total 63 37

Fig. No.12: Effectiveness of services

30%

25%
25% 23%

20%
17%
15%
15%
12%
10% 8%

5%

0%
Yes No Don’t know

Male Female

Interpretation:
The above graph shows that 15% male and 8% female agree that the services provided by
the insurance companies are delivered effectively, 25% male and 12% female do not
agree that the services provided by the insurance companies are delivered effectively and
23% male and 17% female don’t know that the services provided by the insurance
companies are delivered effectively.

46
13. Do you think the promotional efforts being taken by insurance company are
sufficient?
Table No.13: Sufficiency of promotional events
Options M % F %
Yes 39 39% 27 27%
No 24 24% 10 10%
Total 63 37

Fig. No.13: Effectiveness of services

45%
40% 39%

35%
30% 27%
25% 24%

20%
15%
10%
10%
5%
0%
Male Female

Yes No

Interpretation:

The above bar graph shows that 39% male and 27% female think that promotional efforts
being taken by insurance company are sufficient and 24% male and 10% do not think that
promotional efforts being taken by insurance company are sufficient.

47
14. What type of health insurance policy will you prefer?
Table No.14: Preference
Options M % F %
Individual health insurance 10 10% 3 3%
Group health insurance 22 22% 9 9%
Family floater health insurance 24 24% 19 19%
Other 7 7% 6 6%
Total 63 37

Fig. No.14: Preference

30%
25% 24%
22%
20% 19%
15%
10% 9%
10% 7% 6%
5% 3%
0%
ce ce ce r
an an an he
r r su
r Ot
su su in
in in
alt
h
alt
h lth
e e hea
h h
ua
l
up er
d o at
v i Gr flo
di ily
In m
Fa

Male Female

Interpretation:
The above data shows that 10% male and 3% female prefer individual health insurance, 22%
male and 9% female prefer group health insurance, 24% male and 19% female prefer family
floater health insurnace and 75 male and 6% female prefer other insurnace.

15. How the awareness of health insurance can be increased? Rank the following by
assigning 1 to most effective way of enhancing awareness and 10 to least effective way
of enhancing awareness.

48
 Particulars Mean Rank
Newspapers 3.91 1
Conference and seminars 3.77 3
Incentives to policy holders 3.75 4
Renewal notice by insurance companies 3.83 2
Internet (World Wide Web) 3.47 7
Road shows, fare & festivals 3.56 5
Introducing saving linked insurance 3.49 6
Making health insurance mandatory 3.33 8

Interpretation:

It is seen from the above table that among the total respondents, the mean awareness score about
health insurance ranges from 3.33 to 3.91 and the item “Newspaper” has secured higher mean
score and stood at top, followed by “Renewal notice by insurance companies” has secured next
higher mean score and stood at second, “newspaper” stood at third, and finally “Making health
insurance mandatory” secured least mean score and stood at last.

49
15. Which route do you think is the best while taking a health insurance policy?
Table No.15: Route
Options M % F %
Self decision 14 14% 2 2%
Insurance agents 7 7% 4 4%
Advertisement in TV, 11 11% 9 9%
newspaper
Friends suggestion 8 8% 5 5%
Don’t know 23 23% 17 17%
63 37

Fig. No.15: Route

25% 23%
20% 17%
15% 14%
11%
10% 9% 8%
7%
4% 5%
5% 2%
0%
on s er
isi nt tio
n w
c age pap s kno
de ce s ge n’
t
lf an ew ug
Se r , n s Do
su TV ds
In in ien
t Fr
en
m
se
erti
A dv

Male Female

Interpretation:
The above bar graph shows that 14% male and 2% female think that self decision is the best
route while taking health insurance policy, 7% male and 4% female think that insurance agents,
11% male and 9% female think that advertisement in TV, Newspaper, 8% male and 5% female
think friends suggestion and 23% male and 17% female don’t know health insurance insurance
policy.
16. Reason for taking health insurance

Reasons Mean Score

50
 To cover risk 1.32
For better treatment 0.88
High cost of treatment 0.82
Plan family expenditure 0.81
Tax benefits 0.74

Interpretation:
The above data depicts that according to the highest mean score which was 1.32 respondents
strongly agree that reason for taking health insurance is to cover risk. On the other hand, 0.74
being the lowest mean score, shows that respondents strongly disagreed that tax benefits is the
reason for taking health insurance.

51
 CHAPTER-5
FINDINGS, SUGGESTION AND CONCLUSION
FINDINGS
 63 were males and 37 were females in the survey
 the majority of the respondents belongs to the age group less than 30 years with 23%
male and 9% female, followed by age group of 30-40 years in which 35% male and 21%
female, 40-50 years with 3% male and 4% female and above 50 years with 2% male
and 3% female.
 19% male and 9% female are single and 44% male and 28% female are married.
 51% male and 27% female belong to joint family and rest of 12% male and 9% female
belong to nuclear family.
 30% males and 13% females are matric, 27% males and 170% females are higher
secondary, 9% males and 5% are graduate, 3% males and 2% are post gradudate.
 15% males and 9% females are self employed. 34% males and 5% females are labour,
0% males and 18% females are housewife, 9% male and 0% female are unemployed and
5% male and 4% female are professional.
 9% male and 18% female respondents had no income, 17% male and 9% females are
having income of less than 15000, 19% males and 7% females having 15000-25000, 11%
male and 3% female had income of 25000-50000 and 7% male and 0% female had
income of above 50000.
 41% male and 29% female know about health insurance and 22% male and 8% female
don’t know about health insurance.
 15% male and 5% female got to know about health insurance through TV, 9% male and
2% female know about through Newspaper, 5% male and 1% female know about agents,
11% male and 19% female know about through family and 23% male and 10% female
know about health insurance through friends.
 27% male and 6% female care about health insurance policy very much, 36% male and
31% female care about health insurance policy not much.
 1% male and 5% female are ready to health insurance policy, 7% male and 3% female
still need some time, 21% male and 11% female are not ready to buy, 16% male and 13%

52
 female gave no response and 9% male and 5% female can buy only if certain conditions
will fulfill.
 15% male and 8% female agree that the services provided by the insurance companies are
delivered effectively, 25% male and 12% female do not agree that the services provided
by the insurance companies are delivered effectively and 23% male and 17% female
don’t know that the services provided by the insurance companies are delivered
effectively.
 39% male and 27% female think that promotional efforts being taken by insurance
company are sufficient and 24% male and 10% do not think that promotional efforts
being taken by insurance company are sufficient.
 10% male and 3% female prefer individual health insurance, 22% male and 9% female
prefer group health insurance, 24% male and 19% female prefer family floater health
insurnace and 75 male and 6% female prefer other insurnace.
 The mean awareness score about health insurance ranges from 3.33 to 3.91 and the item
“Newspaper” has secured higher mean score and stood at top, followed by “Renewal
notice by insurance companies” has secured next higher mean score and stood at second,
“newspaper” stood at third, and finally “Making health insurance mandatory” secured
least mean score and stood at last.
 14% male and 2% female think that self decision is the best route while taking health
insurance policy, 7% male and 4% female think that insurance agents, 11% male and 9%
female think that advertisement in TV, Newspaper, 8% male and 5% female think friends
suggestion and 23% male and 17% female don’t know health insurance insurance policy.
 The highest mean score which was 1.32 respondents strongly agree that reason for taking
health insurance is to cover risk. On the other hand, 0.74 being the lowest mean score,
shows that respondents strongly disagreed that tax benefits is the reason for taking health
insurance.

53
 SUGGESTIONS

 Insurers should innovating new products with unique features having some multipurpose
benefits at the same time which could create an appeal to the customers, for example a
Insurance policy in which products can give benefits to insured person and nominee also
and at the same with safety and security and as per their religion. In case of premium,
premium of products should not be too high. Marketer should follow the strategy of
‘Good quality products and services in lower premium category for rural customers’.

 It was seen that generally customers like to visits insurer’s office in case of private life
insurance companies as rural customers generally prefer LIC products because of old
mind-set of Government or non-government, so need to update rural customers about
Operations and structure of Private life Insurance companies.

 Regarding promotion, insurer must build up unique imagery appeal for their insurance
products through creative advertisement. More intense research works should be initiated,
studying the specific needs and attributes sorted by the rural customer for different kinds
of product categories. Focus should be given on improvement of services given by the
rural agents.

 Insurer should spread more awareness and relax the product complications to make it
easier to understand. Charges of the insurance companies should be kept low. More
personalized follow up by the companies instead of sending couriers for information
because of rural areas about their investment and all updates. More branches should be
opened in semi-urban areas or rural areas.

54
 CONCLUSION

There is low level of awareness and understanding of life insurance products, and more
generally, of the operation of life insurance companies in rural customers. There is confusion in
the minds of customers between life insurance, general insurance, health insurance, and some
investment products (such as endowment products).

In spite of urbanization in India, rural India still lacks in terms of availability of various financial
products, especially the risk products like insurance. Insurance of rural India is still indicating low
penetration levels and poor densities. The situation has not changed post privatization in 1999. The
Insurance Regulatory and Development Authority (IRDA) have by guidelines, imposed rural
insurance obligations on every insurance player. But, the imposition of these guidelines has not
improved the rural penetration. The private players lack penetration levels in the rural market. The
situation of Life Insurance Corporation of India (LIC) is better because it has been in existence for
decades.

With increase in population and income there is a wide scope in insurance sector. Insurance
sector provides some security to the customers for any type of mis-happening. In this sector,
IRDA plays an important role and time to time gives important guide lines to various companies.
Still, LIC plays an important role and has maximum share in this sector. Recently banking sector
has also moved towards insurance sector since they would get better dividends than the
commission they would get by entering into partnerships with other major insurance market
players.

55
 ANNEXURE-I
BIBLIOGRAPHY

 B. Reshmi, N. Sreekumaran Nair, K.M. Sabu and B. Unnikrishnan, (2007) Awareness of

Health Insurance in a South Indian Population-A Community Based Study,Perspectives
and Issues 30 (3): 177-188.
 Lean, G. S. and Leslie, L. K. (2004), "Consumer Behaviour", City University of New
York.
 Marketing (2004), The ICFAI University Press.
 Philip, K. (2005), "Marketing Management", Northwestern University.
 Singh, B. K. and Srivastava, S. (2008), "Consumer Decision Making-An Empirical
Study", Marketing Innovations for Reaching Consumers, Wisdom Publications, 19-29.
 Rajni M. Shah, Creating Consumer Awareness in Life Insurance, Bimaquest - Vol. VIII
Issue I, January 2008.
 Venkata Ramana Rao, (2008) Life Insurance awareness in Rural India: MicroInsurance
lessons to learns to learn and Teach, Bimaquest - Vol. VIII Issue I, January 2008.
 B.Reshmi et al., (2007) “Awareness of health insurance in a South Indian population a
community based study” Health and Population- Perspectives and Issues 30(3).
 Jangati Yellaiah, (2012) “Awareness of Health Insurance in Andhra Pradesh”,
International Journal of Sci-entific and Research Publications, Volume 2, Issue 6.
 Maheshkumar L choudhar et al., (2013) “Awareness of health insurance and its related
issues in rural areas of Jamnagar district”, National Journal of Community
Medicine│Volume 4│Issue 2│
 Muthukrishnan et al., “Health Insurance in Rural India”, www.languageinindia.com
 B.Ramakrishna Goud et al., (2014) “Prevalence and Factors Affecting the Utilisation of
Health Insurance among Families of Rural Karnataka, India”, International Journal of
current research and academic review, Volume 2.

56
i
 QUESTIONNAIRE

Demographic Profile:
Name :
Gender : a) Male b) Female
Age : a) Less than 30 years b) 30-40 years
c) 40-50 years d) Above 50 years
Marital Status : a) Single b) Married
Type of family: a) Joint b) Nuclear
Education : a) Matric b) Higher secondary
c) Graduation d) Post graduation
e) Vocational f) Other (specify) __________
Occupation : a) Employed b) Self employed
c) Labour d) Housewife
e) Unemployed f) Professional
Monthly income : a. Less than 50000 b. 50000-100000
c. 100000-150000 d. 150000-200000
e. Above 200000
General information:
1. Do you know about Health Insurance?
a) Yes b) No

2. What are the sources of information about health insurance?

a) TV b) Newspaper
c) Agents d) Family
e) Friends f) Movies g. Employees of Insurance Companies
h) Tax consultants and Doctors
i) Other (specify) ______

3. How much do you care about having a health insurance policy?

a) Very much b) Not much

57ii
4. Are you willing to purchase health insurance policy?
a) Ready to buy
b) Still need some time
c) Not ready to buy
d) No response
e) Buy only if certain conditions will fulfill

5. Do you agree that the services provided by the insurance companies are delivered
effectively?
a) Yes b) No c) Indifferent

6. Do you think the promotional efforts being taken by insurance company are sufficient?
a) Yes b) No

7. What type of health insurance policy will you prefer?

a) Individual health insurance
b) Group health insurance
c) Family Floater Health Insurance
d) Other

8. How the awareness of health insurance can be increased? Rank the following by
assigning 1 to most effective way of enhancing awareness and 10 to least effective way
of enhancing awareness.
a) Newspapers
b) Conference and Seminars
c) Incentives to policy holders
d) Renewal notice by insurance companies
e) Advertisement
f) Sponsoring event by insurance companies
g) Internet (World Wide Web)
h) Road shows, fare & festivals

iii
58
 i) Introducing saving linked insurance
j) Making health insurance mandatory

9. Which Route You Prefer While Taking A Health Insurance Policy?

a) Self decision b) Insurance agents
c) Advertisement in TV, news paper d) Friends suggestion

10. Reason for taking health insurance

Reasons S.A A N DA SDA
To cover risk
For better treatment
High cost of treatment
Plan family expenditure
Tax benefits

iv

59