In India, mention of health insurance can be found in the writings of Manusmrithi, Kautilya and Yajnavalkya. They have discussed the importance and the ways in which resources were used to help people. These writings reveal resources were pooled and shared among citizens during natural calamities like famine, epidemic or a flood.
We also find traces of health insurance during British Imperial rule. Some form of insurance can be traced during the early British rule in the form of carrier’s contract and marine trade loans.
Health insurance in India took off under the British. In the year 1818, life insurance business was set up in India. Oriental life insurance Company was established in Calcutta under the British leadership. However, the venture did not succeed and the company closed in 1834.
In 1829 another life insurance company named the Madras Equitable began offering life insurance services in the Madras Presidency.
This era was mainly dominated by foreign insurance companies because of the British rule in India. In the post-colonial era, the Indian Life Insurance act was passed (1950), to end unfair trade practices, abolish principal agencies and nationalize insurance business in India.
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The concept of health insurance originated in ancient Greece and Rome. These countries pioneered the first health insurance in 600 B.C and created guilds named as ‘benevolent societies’. The main aim of these societies was to look after the dependents of the deceased members and bear funeral expenses.
The guilds continued until the Middle Ages and took care of the needs of the people. At the same time, several other societies like the ‘Jewish Talmud’ and ‘friendly societies’ in England worked towards social welfare. These societies pooled funds from donations and general contributions and the money was used in emergencies.
See Also: What Is Health Insurance?
The health insurance policy initially began as medical cover for the insured and his family. At this stage, the reimbursement of cashless facilities was not available under health insurance policies.
At the initial stages, the health insurance came with individual ceiling for each item listed under the policy. However, in the mid-nineties when the government adopted policies like Liberalization, Privatization and Globalization (LPG) model, the private hospitals and the increasing demand for better healthcare facilities, boosted the need for health insurance policies. This helped avail medical facilities and adequate treatment.
Health insurance Companies made several changes and the cap and sub-limits were removed. Many people availed health insurance policies in the late nineties.
The two initial forms of health insurance in India came through government initiatives and were available only in two forms which are - Central government health insurance scheme for government employees and the employee state insurance scheme or ESIC for employees of the private sector. The first ‘mediclaim’ health insurance policy was introduced in the Indian market in the year 1986, and had a minimum and maximum sum assured.
See Also: Types of Health Insurance Plans in India
Since then, multiple private health insurance companies have appeared in the Indian market. In the year 2001, the third-party administrators or TPAs were introduced which served as a link between the insurance companies and network hospitals.
Soon cashless medical claims were introduced and the insured did not have to pay the hospital bills as they were directly settled by the insurer with the hospital. The evolving private sector led to the advent of group medical insurance.
Currently, the health insurers offer various types of health insurance to suit buyer requirements. Currently, health insurance policies offer reimbursement plans along with cashless claim facilities. The health insurance offers additional riders, so that the buyer can modify the existing policy, according to changing medical conditions. The recent addition to the health insurance market is online health insurance which allows the buyer to compare, purchase and manage health insurance online.
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