International rating agency Moody’s has said Ayushman Bharat, Government’s most ambitious healthcare insurance programme, is credit positive for insurance companies as it will aide in higher premium growth.
Prime Minister Narendra Modi, in his August 15 speech, cleared the air about the launching date of the healthcare insurance scheme, touted as ‘Modicare’. He said the programme would be launched on September 25.
The Government promises an insurance coverage of five lakh per family per year for secondary and tertiary care hospitalisation under the scheme.
The scheme will cover over 100 million poor and vulnerable families who face lots of hardships due to out-of-pocket medical expenses.
“The launch of universal health coverage is credit positive for the country’s insurers because it will help grow health premiums and provide insurers with cross-selling and servicing opportunities,” Moody’s said in its report on Thursday.
Health insurance contributes around 23 per cent of general insurance premiums and is one of insurers main drivers of growth, according to the report.
During financial year 2011-12 to 2016-17, health premiums have grown at a compound annual growth rate of 18 per cent.
As of FY17, only 440 million people were covered under health insurance schemes, and the rating agency expects the AB-NHBM to increase that number by 500 million.