Aditya Birla Health Insurance is focusing on non-metro cities, where it generates 70% of its business, despite challenges such as the 18% Goods and Services Tax (GST) on premiums. The company’s CEO, Mayank Bathwal, believes that health insurance may need to be made mandatory if current efforts and government initiatives do not increase adoption. He suggests that the industry needs to work together to promote awareness and education to encourage more people to buy insurance.
The company is not planning an initial public offering (IPO) in the near future, with its primary focus on strengthening its franchise and sustaining growth. Bathwal emphasized that group insurance is often seen as a low-margin segment, yet it has been a significant part of their product mix, driven by profitability in the small and medium-sized enterprise (SME) segment.
Aditya Birla Health Insurance has also been focusing on wellness-linked health insurance and has integrated with major wearable providers, including Apple Health and Noise. The company has also seen a significant increase in first-time policyholders since partnering with Noise. Bathwal believes that the trend of people opting for higher coverage is a positive sign, as they recognize that lower coverage may not be sufficient.
However, he also acknowledged that the growth in health insurance purchases on the retail side has been limited, driven primarily by corporate health insurance. Bathwal believes that the 18% GST on premiums is a significant cost barrier, and suggested that reducing GST for the middle-income group could make insurance more accessible and inclusive.
In terms of expansion, the company is focusing on non-metro cities, where they have generated 30% of their business. They have introduced more affordable products for these areas and have observed that people are opting for larger ticket sizes. Bathwal believes that insurance can be made more accessible and inclusive by reducing GST for the middle-income group.