Disability Insurance:Disability in India imposes severe financial burdens, with hundreds of thousands of people facing temporary or permanent limitations annually. Recognising this urgent need for financial protection, insurance providers are introducing new solutions to address the gap, according to a PTI report. A 2018 report by the Ministry of Road Transport and Highways (MoRTH) highlighted that despite accounting for just 1 per cent of the global vehicle count, India suffers from 6 per cent of all road accidents.
High disability rates
Experts estimate that between 5 and 7 lakh people suffer from disabilities annually due to high rates of accidents and debilitating illnesses, often losing their ability to work and support themselves. “The financial strain of disability is significant, with substantial healthcare costs making comprehensive insurance coverage essential to avoid financial hardship,” said Ramit Goyal, Chief Distribution Officer, Future Generali India Insurance. A study titled ‘Measuring the Financial Impact of Disabilities in India’, available on the National Institutes of Health (NIH) website, reveals that approximately 20.32 per cent of monthly household expenditure is spent on out-of-pocket disability expenses.
More than half (57.1 percent) of households with disabled members face catastrophic health care costs, and nearly one-fifth (19.1 percent) of households that were above the poverty line before the disability are now below it.
Advances in disability protection
R Garg, head of term insurance at Policybazaar, highlighted the importance of disability income protection in India, where there is no comprehensive social security system like those in developed nations. With 2.2 per cent of the population affected by disability, this coverage is becoming increasingly crucial. Future Generali India Insurance has introduced a new group health insurance product that covers temporary and permanent disabilities caused by physical or mental illness, accidents and other unforeseen events. This plan offers up to 75 per cent of pre-disability income per month, along with possible coverage of monthly loan installments and credit card payments. Bajaj Allianz has reported a steady rise in personal accident insurance, including disability income protection. Bhaskar Nerurkar, head of the health management team at Bajaj Allianz General Insurance, noted that rising living costs and increased awareness of financial security are driving this trend. Rising accident rates are prompting more individuals and businesses to seek disability and loss of income coverage. Nerurkar also highlighted that continued support and favourable regulations from the IRDAI could further boost this growth. Nanda Gopal, Founder and CEO of Upsure, highlighted the critical need for disability income protection plans (DIPs), particularly for vulnerable groups such as daily wage earners and self-employed individuals. “Disability can have a devastating impact on your financial stability,” Gopal said.
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