The plan provides a safety net by replacing up to 75 percent of pre-disability income per month, along with possible coverage for monthly loan payments and minimum credit card payments | Representative image
A staggering number of Indians face financial hardship due to disability, with hundreds of thousands suffering temporary or permanent limitations each year. Recognizing this critical gap in financial security, insurance companies are stepping up with innovative solutions, officials said Sunday.
A 2018 report by the Ministry of Road Transport and Highways (MoRTH) revealed that India, despite having just 1 per cent of the world’s vehicles, accounts for 6 per cent of all road accidents.
According to experts, between 500,000 and 700,000 people in the country suffer temporary or permanent disabilities each year due to high rates of accidents and crippling illnesses and lose their ability to work and earn a living.
“The onset of a disability often brings with it substantial healthcare expenses, making comprehensive insurance coverage crucial to prevent social and financial decline,” said Ramit Goyal, distribution director, Future Generali India Insurance.
A study titled ‘Measuring the Financial Impact of Disabilities in India’, available on the National Institutes of Health (NIH) website, suggests that about one-fifth (20.32 percent) of monthly household consumption expenditure was spent on out-of-pocket expenses due to disability.
More than half (57.1%) of households were forced to face catastrophic health care costs because one of their members was disabled. Nearly one-fifth (19.1%) of households that were above the poverty line before one of their members received treatment for a disability were pushed below the poverty line.
According to R Garg, Head-Term Insurance, Policybazaar.com, in a country like India, where there is no social security coverage like in developed countries and where 2.2 per cent of the population is disabled, having disability income protection becomes prudent.
FGII’s recently launched group health insurance product covers both temporary and permanent disabilities arising from physical or mental illness, accidents and unforeseen events resulting in loss of income.
The plan provides a safety net by replacing up to 75 percent of pre-disability income per month, along with possible coverage for loan payments and minimum credit card payments.
Bajaj Allianz, another leading insurer, said it has seen a steady rise in take-up of personal accident insurance, which includes disability income protection.
Bhaskar Nerurkar, head of Bajaj Allianz General Insurance’s health management team, said rising living costs and increased awareness of financial security through insurance are driving this trend. He added that as accident rates rise, more people and businesses are looking for disability and loss of income coverage, leading to higher penetration rates.
Continued support and favourable regulations from IRDAI can further boost this growth, Nerurkar emphasised.
P Nanda Gopal, Founder and CEO of Upsure, emphasizes the critical need for DIP schemes among vulnerable groups like daily wage earners and self-employed workers.
“These individuals face a devastating financial situation when they become incapacitated,” Gopal said.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First published: August 11, 2024 | 1:48 PM IS
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