Health insurance is one of the least understood concepts in India. Ordinary people still refrain from buying family health coverage due to a common belief that insurance companies do not pay out claims easily. Many others fear that claim settlement is tedious, and believe insurance providers are solely focused on earning high premiums by making unrealistic promises.

But are these fears valid? Of course not! Such misconceptions arise due to a significant anomaly in the healthcare industry, namely, the information gap.

How does the information gap cause health insurance myths?

The information gap between the insurer and the insured gives rise to various misconceptions, such as:

• Health insurance in India is too expensive!
• Health insurance puts an extra burden on the budget.
• Critical Illnesses such as cancer, diabetes, and heart ailments are often not covered!
• There is always a considerable waiting period clause.

These myths often divert people’s attention to their budget limitations, overshadowing the benefits of adequate health coverage.

In this regard, Dr Vinod K Paul, Professor of Neonatology, AIIMS New Delhi, has said:

“30% of India’s population is from the middle-income families (nearly 40 crore) and doesn’t have a family health insurance. These ‘missing-middle’ aren’t poor enough to depend on government schemes or rich enough to afford private health insurance. Currently, most of the insurance products are targeted at the high-income group.”

Why is there such a significant information gap in health insurance?

The information gap in health insurance largely stems from a lack of proper communication between the insured and the insurance provider. Additionally, several factors exacerbate this gap:

• Lack of awareness and financial literacy
• Low purchasing power of the general public
• Limited reach and availability of feasible options.

Therefore, it is essential to offer well-designed, reasonably priced, and well-communicated family health insurance plans tailored to the ‘missing middle’ group. Furthermore, the active participation of both ordinary people and insurance providers is crucial for bridging this gap.

How can ordinary people debunk their health insurance myths?

Ordinary people can overcome their misconceptions regarding family health insurance through active engagement. Here’s how they can go about it:

• Read policy documents carefully: Understand the terms and conditions, coverage details, and exclusions.
• Ask questions: Don’t hesitate to ask questions and seek clarification from the insurer.
• Utilise online resources: Explore the insurer’s website, app, and other online resources for information.
• Regularly review the plan: Review the policy annually to ensure it still meets your needs and understand any changes.
• Update information: Keep contact information and health details updated with the insurer.
• Understand claim procedures: Familiarise yourself with the claim process to avoid delays and complications.

These are some proactive measures you can take to debunk your health insurance myths.

How can insurers bridge the information gap in health insurance?

Insurance providers can play a proactive role in filling the information gap between them and insured individuals by ensuring the following aspects:

• Enhanced transparency
• Proactive communication
• Personalised support, and
• Use of digital tools to debunk myths

How can health insurers ensure better transparency?

Health insurance providers can create a better understanding between them and insured individuals through various ways, such as:

• Plain language documents: Provide policy documents that are easy to understand, avoiding jargon and technical terms.
• Detailed summaries: Short summaries of key policy details, coverage limits, and exclusions alongside lengthy policy documents.
• Online portals: Create user-friendly portals where policyholders can easily access policy details, claim status, and coverage information.
• Regular updates: Send periodic updates on policy changes, new benefits, or essential information related to health insurance.
• Educational content: Share articles, videos, and infographics explaining various aspects of health insurance and related health topics.
• Reminders: To reduce the chances of misconceptions, it is a good practice to send SMS, emails, or app notifications to remind customers about renewals, premium payments, and important deadlines.

These are some of the positive measures that eliminate the scope of misunderstanding.

Safeguard your finances against a health emergency with health coverage

Always remember, a comprehensive family health coverage is a valuable asset, and not a liability, which acts as a shield to protect your savings from getting drowned in hefty hospital bills and other medical expenses during a health emergency. A comprehensive family health insurance plan covers all types of critical illnesses. While choosing such a health coverage, it is essential to look for crucial aspects of coverage such as sub-limits or waiting periods in case of pre-existing conditions.