Health Insurance Premium Growth Slows Down, but Employees Opt for Additional Covers
Mumbai: In a trend that hints at a slowdown in corporate hiring, the growth rate of healthcare insurance premium has taken a hit, according to the top executive of India's largest third-party administrator, Medi Assist.
Industry group premium growth in the first half of the fiscal year is about 11%, with industry experts stating this is probably one of the lowest growth rates in a long time. CEO Satish Gidugu attributed this trend to companies reducing their expansion plans due to economic challenges faced by industries.
However, despite the slowdown in corporate hiring, Medi Assist CEO Gidugu stated that the company's premium and revenue growth are still on track, albeit at a slower pace. Group premium grew 15.6% year-on-year to ₹9,343 crore, while retail premium jumped an impressive 41.2% over this period.
The main reason behind the slow down in corporate hiring is believed to be the economic recession in industries such as banking and real estate. However, employees are opting for additional covers beyond what their employers offer.
"It's great news for us," Gidugu stated. "We see many more people taking up medical insurance schemes, even when they're not required by law. For example, they may choose to opt-in for teleconsultations or home lab visits due to the flexibility and convenience of these services."
Despite slower growth rates in corporate sectors, Medi Assist's operating revenue grew 15.4% year-on-year to ₹348.5 crore.
The company has set its sights on retail premium as a key growth area alongside group premiums.
In a significant development for Medi Assist, the firm has announced plans to acquire Paramount TPA, backed by Fairfax Inc., for an amount of ₹312 crore. Once regulatory approvals are obtained, which will take around 3-4 months, Médicid Assis TPA's market share will grow to 36.6% in group segment and 23.6% of the entire health insurance industry.
As of September, Medi Assist already holds a market share of 19.2%.