The healthcare costs in India are rising, and as a result, preventive care is becoming a key focus for insurers. Despite progress in coverage, over 60% of healthcare expenses are still borne directly by households, highlighting gaps in traditional insurance models. Mayank Bathwal, CEO of Aditya Birla Health Insurance, explains that conventional health insurance has historically focused on hospitalization, leaving everyday healthcare expenses, such as outpatient consultations and chronic disease management, largely uncovered.
To address this issue, insurers are expanding coverage to include outpatient and preventive care, which helps manage expenses more predictably and reduces avoidable hospitalizations. Affordability is also a challenge that cannot be solved by pricing alone, and reducing healthcare costs through better coordination and promoting preventive care is essential. Innovation in product design and distribution is also crucial to engage first-time buyers, particularly younger consumers who value clarity, relevance, and ease of use.
The use of AI-enabled tools and assisted-digital models can simplify discovery and onboarding, while also enabling insurers to provide faster and consistent service. Building trust and retention is also important, and programs such as ABHI’s HealthReturns, which rewards policyholders for healthy behavior, can help shift the perception of insurance from a reluctant purchase to a valued product.
Collaboration across insurers, healthcare providers, and policymakers is critical to creating a comprehensive health ecosystem. Digital infrastructure, such as ABHA and Bima Sugam, is creating transparency, improving claims processing, and enabling more predictable pricing. Sustained dialogue between providers and insurers helps align treatment protocols and pricing, ultimately benefiting both customers and the insurance ecosystem.
ABHI’s broader vision is to move from a reactive, hospital-focused model to a comprehensive health ecosystem, with a focus on chronic condition management and wellness initiatives. This approach aligns customer health outcomes with the insurer’s sustainability goals and marks a significant shift in the role of health insurance in India. By expanding coverage to outpatient and preventive care, promoting affordability, and building trust and retention, insurers can provide more comprehensive and sustainable healthcare solutions for their customers.