An Empirical Study of Health Insurance Literacy and Willingness to Pay

Abstract

Most emerging economies have made universal health coverage their national policy priority (Prinja et al., 2019). As per the Forbes India Report (2021), only 37% of the population are however covered under either the government or private health insurance schemes, which is far from satisfactory for India. Though Covid-19 has propelled health insurance coverage, considering the rising healthcare costs, buying health insurance is a necessity for every individual. Against the above background, the current study examines the perception, awareness and knowledge, especially among the earning-class towards health insurance after the pandemic. It investigates the insured individuals’ knowledge, specifically about the policy benefits and claims procedure in Tamil Nadu. Further, the study covers the buying behavior of uninsured individuals. This survey, through a structured questionnaire, was carried out among both the insured and uninsured, with a sample size of 400 participants in Tamil Nadu. The responses rate was 97.75%.

The results of the study reveal that the perception of respondents about health insurance has changed post-pandemic as 66% of them considered it important, and, felt secured once insured. There is only a moderate awareness about health insurance, policy claims’ procedure and locations in Tamil Nadu. However, there exists health insurance awareness among the uninsured population, as they also exhibit willingness to purchase a policy, provided there is precise transparent information on policy benefits and ease of claims’ settlements. This aspect of insurance is an important take away for insurance providers as well as policy framers to accordingly create mass awareness and educate the people about health insurance.