Post Covid Strategies of Health Insurance Sector

The pandemic has contributed to a sudden recognition of the importance of protective

investment, especially in the health and safety aspects of life. In the health ecosystem, the
pandemic has made its mark on nearly all markets and businesses across the spectrum,
including health insurance. Health insurance has certainly taken the forefront when it comes
to return-based instruments, both from the point of view of providing access to affordable
healthcare as well as investing in healthcare financing.
In spite of the optimistic developments that the health care sector has undergone over the last
few months. There has been a positive 30-40 per cent rise in health insurance penetration
across market players, with some players experiencing a substantial jump rather than others.
Also, the sector has undergone a major transition to digitalisation. Not only has the need for
digital delivery solutions been relevant, the nature of resources has also caused the need to
focus on digital systems across the spectrum: whether they be underwriting processes or
processes related to policy-making or filing claims.
There has been a noticeable shift in the mind of the consumer. And I believe the element of
fear certainly played a part, because not only do we see consumers buying any of these items,
but we also see a lot of activism going on in the form of renovations. People who are
currently insured by health care tend to continue to benefit from their continuity and so the
renewal rate has risen by a few points in the past few months. The pandemic has contributed
to a sudden recognition of the importance of protective investment, especially in the health
and safety aspects of life. Health insurance has certainly taken the forefront when it comes to
return-based instruments, both from the point of view of providing access to affordable
healthcare as well as investing in healthcare financing. Over time, this could lead to a
transition in health insurance from a conventional "push" product to a "pull" one.
Around the same time, the health care sector is tackling a range of problems and complexities
that are directly borne out by the pandemic. In certain cases, the market is dealing with very
contradictory claims knowledge. There is, in effect, a visibly high degree of dissonance at the
time of allegations, which has a very unpleasant influence on the consumer. While the
insurance regulator has been diligent in ensuring that there are no undue obstacles at the
claims stage, there have been causes that have had a direct effect on experience.
Also, there is a strong and disconcerting ambiguity regarding the cost of care for Covid-19.
With considerably higher claims costs than those commonly associated with infectious
disorders and epidemics, the Coronavirus pandemic is a true nightmare in many ways. Some
insurers are now unable to correctly forecast the effect on health care rates and, as a result,
the claims book.
Thus, recent outbreaks of diseases such as COVID-19 have contributed to greater
understanding among citizens about insurance, and most of them now feel it important to be
ready (at least for the future) for such unexpected circumstances. Before the outbreak of the
coronavirus pandemic in India, just 10 per cent of citizens were involved in paying insurance
to cover health crises, like contagious and pandemic diseases, yet now 71 per cent of people
consider health insurance to be a must to combat unforeseen pandemics such as COVID-19.
In order to cope with the current COVID crisis and to ensure that the maximum number of
people insured by any sort of health insurance against COVID-19, IRDAI directors, general
and health insurers have started selling two regular plans – Corona Kavach – a health
insurance plan focused on indemnity and Corona Rakshak – a defined benefit health
insurance package – to cover medical costs.
As a result of the onset of the COVID-19 pandemic, insurance companies were at the centre
of the storm. Several carriers had to make their operations remote in a matter of hours and
days (not weeks). Around the same time, calls were made to change coverage; to respond to
complaints about business interruption policies; and to continue paying for life, health and
injury and disability insurance claims. There's an insurance firm built for this. Risk
prevention and disaster preparedness are at the core of their business. With policyholders
struggling as a result of the crisis, regulators and politicians expect insurance providers to live
up to their duties. With policy-holders failing as a result of the crisis, regulators and policy
makers want insurance providers to live up to their obligations. Those that are not supposed
to endure enormous reputational ramifications. It's not a probability to get it wrong.
The crisis has so far been exceptionally well controlled by insurance companies, largely
thanks to investments that have already been made in networks, applications, laptops and
more. A variety of gaps and flaws have been exposed by the crisis and the need for more
technical investment has been reinforced. Overall, however, company leaders should be
assured that the struggle is being dealt with and that, while precarious, the near-term journey
ahead is one they know how to navigate.
Some Significant findings:
 Because of the effects of COVID-19, 15 percent of survey takers say they are willing
to buy life insurance.
 37% are worried that the pandemic might have a possible financial effect on their
retirement account.
In response to the crisis, insurance companies have become agile in adopting remote
technology. However, a number of additional technology investments (e.g. customer data
management and mobile app integration technology, portals and call centres) have been
delayed due, in part, to employee resistance issues. It is now clear that a phased approach to
technology adoption will not be enough to help insurance firms compete on a fast-moving
market for virtual operations. In addition, following the country-wide damage caused by the
pandemic, IRDAI urged insurance providers to extend the grace period or pause by 30 days
in the event of a policy interruption or renewal. Which could raise some acute liquidity
problems for insurance firms.

All in the health insurance business will readily vouch for how dramatic Covid-19's impact
on their industries and lives has been. There is also a full-scale change underway and the
digitalization of the consumer experience would, of course, be a vital component of this
transformation. In my view, the industry and its customers – the insurance buyers – can
expect some clear changes in the coming months and years.
Next, we're starting to see a fast-growing trend in health insurance plans that are innovatively
built. In fact, for the longest time, product design has been a crucial obstacle to genuine
digitalisation. Some insurance companies have attempted to adapt their automated processes
to a commodity based on an offline model of delivery.
Complicated product specifications, dynamic requirements for risk control, different and
confounding product variants have all led to goods that do not always inspire purchasing. The
need for user-friendly digital products has never been greater, with people coming around to
buy health insurance online.
Secondly, we can see an increasing understanding of the need to simplify the reporting of
policies. Simplified and uncomplicated policy advantages would need to be followed by
precise as well as easy to interpret terminologies and product documents. This will play a
significant role in establishing trust and a truly digital experience; not to mention, a greater
access for people across economic and educational backgrounds.
Thirdly, we will see the emergence of a complete digital ecosystem for claims processing and
policy management. Be it automated claim adjudication that can significantly improve
decision-making times, or better digital controls at the provider and insurer’s end, customers
are looking to significantly faster claim settlements which require minimal manual
processing.
Fourth, we will also see the emergence of a user-centric digital distribution channel. The
primary factor here will be how convenient and easy it is to buy an insurance policy online.
With existing insurers focussing on digital distribution models, the emergence of specialists
such as Acko and Godigit, along with the entry of next-gen digital healthcare financing
distribution companies like Vital, Plum, Onsurity, Toffee, Kenko , Riskcovry etc. that are
looking at offering customer experiences that go beyond plain vanilla insurance plans, things
sure seem to be getting exciting in this space. These new companies are focusing on user
experiences with not only the insurance product but also other wellness needs.
Of course what remains to be seen, is just how long will the pandemic and its impact last, and
will it truly transform the way industry functions for the better. Customer attention spans are
short, and one needs to be quick to capitalise on them. Will the insurance companies and
distribution partners be able to capitalise on this opportunity, and ensure adequate retention of
existing digital adopters while also driving a permanent change in customer buying patterns –
remains to be seen.
Conclusion –
The COVID-19 pandemic is thus a threat for the health insurance sector on a variety of
fronts; at the same time, it is an opportunity. Health insurance is intended to cushion the blow
that this pandemic will take. Although being highly important to society by effective
prevention techniques, insurance providers will be able to afford to promote it by robust
product marketing efforts and to ensure that it reaches them.
Also, the insurance sector is also planning future mergers between traditional companies and
Insurtechs to promote digitisation by growing the budget, thus improving competitiveness
and crisis management capabilities. To become more competitive, firms still dealing with
solvency problems are likely to choose to combine with each other. Reduction and freezing
of recruitment is expected at the workers level. And the vast majority of services are running
as usual.
On the other hand, the reputation of insurance companies has been improved as a result of the
multiple humanitarian actions they carried out since the pandemic.
In fact, clients are wondering how to schedule an appointment to make a policy with a broker.
There is a time of detachment from society. For this reason, many have switched to 100%
digital insurance undertakings, which threaten traditional insurance undertakings that do not
have a digital renewal plan and, at the same time, provide a great business opportunity.