New Delhi: Zerodha co-founder Nithin Kamath has highlighted the importance of comprehensive health insurance for Indians, warning that most people in the country are “one hospitalization away from bankruptcy.” In a post on X, Kamath urged Indians to carefully select health insurers, recommending those with a proven track record of at least five to ten years and a claim settlement ratio between 80-90 per cent to avoid financial difficulties.
Most Indians are just 1 hospitalisation away from bankruptcy. A good health insurance plan is mandatory. pic.twitter.com/9GzKpT6EE9
— Nithin Kamath (@Nithin0dha) August 30, 2024
Kamath also advised choosing insurers with a network of 5,000-8,000 hospitals and an incurred claim ratio of 55-75 per cent, emphasizing that financial stability in an insurer is vital for long-term security.
A recent report by insurtech company Plum, titled "Health Report of Corporate India 2023," paints a worrying picture of healthcare costs in India. The report shows that India has one of the highest medical inflation rates in Asia, reaching 14 per cent, which has significantly strained employees' finances.
According to the report, a staggering 71 per cent of workers pay for their healthcare out of their own pockets, while only 15 per cent receive any health insurance support from their employers. This situation is concerning as India’s workforce is expected to grow from 522 million in 2022 to 569 million by 2030.
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The burden of healthcare costs is especially heavy on over 90 million people, with these expenses consuming more than 10 per cent of their total income. Despite the expected growth in the workforce, employer-sponsored health coverage remains limited, particularly for younger employees aged 20-30, who are half as likely to have employer-sponsored insurance compared to those aged 51 and above. Additionally, 42 per cent of employees across all age groups have expressed a desire for "flex benefits," allowing them to tailor their healthcare plans to better meet their needs.
Further complicating the issue, only 12 per cent of companies offer telehealth support, and less than 1 per cent provide outpatient coverage. This lack of comprehensive support is particularly concerning for the 85 per cent of employees with chronic illnesses who feel unsupported by their employers.
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