82% of urban middle-income Indians don't have health insurance: BigDecisions Survey

BENGALURU: A recent survey by BigDecisions, a personal finance advisory platform, shows that 82.2% of urban middle-income Indians do not have health insurance. Of the 17.8% who have health cover, it is adequate to meet less than 67% of their expenses related to potential medical contingencies. That means over 33% of urban India is underinsured. Underinsurance level for families of 4 or more is at a staggering average of 49%.

Inadequate coverage means a greater out of pocket expense. An evaluation of 9 lakh claims over five years shows a strong dip in claims received versus actual treatment cost. The gap increased when costs exceeded Rs 3 lakh per treatment. For instance, in 2015, for a treatment cost below Rs 3 lakh, 85% of claims were received; whereas, for a Rs 10 lakh treatment only 30% claims were received.

Inflation has played a role in making healthcare more expensive. Treatment of communicable diseases has turned dearer by over 9.3% annually while that of circulatory system related diseases have increased anywhere from 2-13% per year between 2011-2016 depending on the city one lives in.


A substantial increase in the cost of health insurance premiums in the range of 9-16% by a family of two post the age of 35 has also been observed. For a family of four, a marginal increase of 7-8% in the cost of health insurance premiums has been observed till the age of 40, post which premium costs can spike by over 10%. The figures indicate that it's cost effective for consumers to purchase health insurance at an early age.

"The insights from our report clearly indicate that 'Health isn't Wealth' for a vast majority of urban Indians who do not realise that they are underprepared to meet expenses related to potential health crises in the future. What we are aiming to do with this report is to educate them on two fronts; one, the inadequacy of their insurance cover that they have at present for meeting future exigencies and two, emphasise the greater need to be financially prepared for medical care as they grow in terms of age and family," says Manish Shah, Co-founder and CEO, BigDecisions.