PESTEL Analysis

PESTEL Analysis – Indian Healthcare Insurance Politico – Legal The Insurance Regulatory and Development Authority (IRDA) legislation in 2000 served as a key milestone in healthcare insurance. It opened up the health insurance industry to private players. Health insurance membership quadrupled between 2007 and 2011 (300 million in 2011) and is expected to be 600 million by 2015. The recent changes in FDI (2012) norms open up the health insurance market to global players. To encourage insurance sector to increase its spread in rural India government has made regulations more favorable for rural people by decreasing the amount of premiums, introducing new group insurance plans and various other special plans for farmers. Economic The Indian healthcare Industry is estimated to grow to ~ $280 billion by 2020, up from $79 billion in 2012. With over 70% ‘out-of-pocket’ expense burden on the consumers, the market is ripe for health insurance entities including global players. The gross domestic savings of people in India have increased significantly (projected to be 39 per cent by 2017) due to which they are moving towards new ways of investing money for the future benefits including various insurance plans. Social India’s per capita spending on healthcare of $109 is much lower than the global average of $863.3. India trails in health outcomes behind its South Asian neighbors like Sri Lanka and Bangladesh, which have comparable per capita income. Increase in life span, rise in elderly population, an increase in the spread of lifestylediseases and thereby increased uncertainty about life has more people signing up for health insurance schemes. Also the perception of the Indian people towards insurance is changing from merely a tool to save taxes to a mechanism to transfer risk for the long term wellbeing. Technological Disruptive innovation: Medical diagnostics, artificial intelligence and big data are sparking disruptive innovations that are redefining care paradigms. Disruptive emerging technologies such as cloud computing, mobility solutions, telemedicine, and social computing are poised to enter mainstream operations. PHIs can leverage best practices from other markets including process and technology to get a jumpstart in a 1.3 billion market. Healthcare Information Technology spending is expected to be around $609.5 million in 201313 and touch ~$1.8 billion by 2020. The transformation in healthcare delivery is likely to make a positive impact on the proliferation of healthcare insurance among the masses.

Automation of processes has made it easier to reduce the time in issuing policy documents. Also the internet driven information era has made it easier for people to look for data and make a well informed choice regarding their choice of policy without falling prey to the hard selling tactics of insurance agents.