SAHIs share in retail health insurance segment rises to 57% in FY24

According to the red herring prospectus (RHP) filed by Niva Bupa, the growth in share is attributed to the rising number of individual agents, an expanding hospital network

The share of standalone health insurers (SAHIs) in the retail health insurance segment rose to 57 per cent of the Gross Direct Premium Income (GDPI) worth nearly Rs 18,000 crore in the April-August period of FY25.

 

The share was around 40 per cent in the whole of FY18 and 56 per cent in FY24. 

 

According to the RHP filed by Niva Bupa, the growth in SAHI market share is attributed to a rising number of individual agents, a faster-growing hospital network, and a higher number of product launches.

 

Standalone health insurance companies include Star Allied Health Insurance, Care Health Insurance, Niva Bupa Health Insurance, Aditya Birla Health Insurance, and Manipal Cigna Health Insurance. In 2024, the Insurance Regulatory and Development Authority approved Narayana Health and Galaxy Health Insurance.

   

Retail health insurance is primarily driven by individual agents, who contributed 55 per cent of retail health GDPI in FY23, according to the report. From FY18 to FY24, the number of individual agents for SAHIs grew by 21.5 per cent to 1.3 million. In comparison, agents for general insurers grew by 10.7 per cent to 330,000, while public-sector agents increased 4.2 per cent to 319,000.

 

The retail health GDPI grew at a compound annual growth rate of 17.7 per cent, from Rs 16,000 crore in FY18 to Rs 42,200 crore in FY24.

 

“Retail health has grown significantly post-Covid-19, which has spurred demand for higher-value policies and some premium increases. Also, SAHIs tend to have a better hospital network than other industry players, driving the increase in SAHI market share in the retail health insurance segment,” said Saurabh Bhalerao, head of BFSI Research, CareEdge Ratings.

 

According to the report, SAHIs witnessed the highest increase in their hospital network through direct contracts and third-party administrators (TPAs) during the FY21-FY23 period. The number of hospitals in partnership with SAHIs increased by 71 per cent from FY21 to FY23, reaching 152,000, while the private sector saw a 63 per cent increase to 484,000. In contrast, public sector insurers experienced a 43 per cent decrease in their hospital network, falling to 37,190.

 

“While other general insurers have been working to improve their presence in the retail health segment, the initial high costs involved in customer acquisition have led to slower growth compared to SAHI players,” said Neha Parikh, vice-president & sector head (financial sector ratings) at ICRA.

 

Parikh said SAHIs benefit from their larger scale and are better positioned to attract retail customers with additional benefits such as free health check-ups, premium discounts for healthier lifestyles, and customised insurance plans.