A typical day in your life can help you understand how health insurance is poised to change. You can book a cab or track steps during a workout with just a few clicks on your phone. You can shop or watch movies from personalised lists recommended just for you. Technology has made our lives easier. It has also given rise to the tech-aware consumer, whose interactions in a connected world are now fueling the disruption in health insurance.
This growing tribe demands value and a better user experience. They want the same engagement levels, relevance, access and convenience in their health insurance products that they have come to expect elsewhere. In 2019, I see this group of consumers influencing major shifts within India’s health insurance landscape.
Customer obsession in a digital world
From booking a doctor’s appointment, to buying health insurance, customers want to do it in real-time on their smartphones. Take this a step further, and they would rather wish it was all taken care of. New-age insurance offerings include concierge services that are just a call or click away. Weave in technology, and these services can be fine-tuned to meet customers’ specific requirements, like finding the right doctor for a particular condition in their locality. Health insurance companies will have to look through the consumer’s lens as they harness technology—whether it is using AI software to develop customised offers or leveraging data analytics to give consumers more personalised products.
In its 2017 Consumer Health Insights (CHI) Survey, McKinsey asked respondents which companies healthcare organisations should aspire to be like. It’s no surprise that they selected tech-focused innovators such as Amazon, Google and Apple, besides high-performing retailers like Walmart. McKinsey observed that the “types of interactions and relationships consumers have with these companies strongly suggest what they want from healthcare organisations.” The ease of use that tech innovators focus on, with the kind of customer centricity that’s par for the course in retail, are set to overturn how health insurers solve problems for customers.
The app way: From cumbersome to convenient
Today’s tech-savvy customers are always connected and get a lot done on the go. Customers wanted to book appointments with doctors in real-time. They want cashless payment, diagnostic booking services and tele-consultation with doctors. Apps simplify the journey for consumers. But they also give insurers a channel to engage with customers and understand their preferences, which can eventually lead to more intuitive products.
The holy grail to value and convenience
Customers find value at the sweet spot where pricing meets quality and product choices are relevant to them. They look for plans that are aligned to their budget and very specific needs. Conventional plans will increasingly be supplemented by a diverse range of products that reflect the customer’s evolving mindset and healthcare needs. In a growing trend, customers now want overall expenses towards healthcare to be covered by insurance. Currently, about 65 percent of expenses related to healthcare are out of pocket. These include OPD, pharmacy and diagnostics, which most health insurance policies don’t cover. But as customers demand this shift, insurers will develop new ecosystems to cover a broader spectrum of expenses that deliver convenience.
The rise of niche, customised products
Customers are choosing products that match very specific needs. With wearable tech, insurers can now leverage data to develop products that are niche and specific for chronic illnesses like cancer, cardiac ailments or diabetes. This trend also reflects our changing community health needs. For example, more and more customers are choosing critical illness plans like cancer insurance. Cancer-related claims increased by 16 percent YoY in 2018.
With the Insurance Regulatory and Development Authority of India (IRDAI) bringing HIV and mental illnesses within the ambit of health insurance, offerings will become more inclusive. As customers embrace new ways of thinking and open up about previously-taboo areas, I see insurers iterating to evolve products that are comprehensive and customised to reach new segments.
Made for Millennials: The ‘preventive’ approach
The World Economic Forum has called out chronic disease as our biggest global health challenge. It recommends redirecting health systems towards prevention and achieving a healthy lifestyle. A 2018 Health and Wellness survey we conducted across six Indian cities, with 2,100 respondents, revealed prevention is already a priority and focus area for younger customers. 29 percent believe regular preventative health checks are important for greater wellness. Besides providing preventive services like screenings, I see insurers moving to a more outcome-based preventive model, aimed at customers leading healthier lives. New-age products will reward customers for their success in meeting a pre-agreed upon health goal or score. Or, they might offer personalised health coaching, putting customers on the path to better health. 43 percent of respondents told us they expected an increase in coverage with no increase or a marginal increase in premium for achieving fitness targets.
What will the new generation of customers want in their health insurance plans? Research reveals that millennials are becoming increasingly health and fitness conscious. Traditional insurance offerings do not resonate with their needs or lives. They seek everyday health, wellness and fitness. It’s a change that can significantly increase the penetration of health insurance in India by bringing the next wave of customers on board.
The author is MD & CEO of Max Bupa Health Insurance.