4.2% of India’s GDP is spent on healthcare

 03-Mar-16, India Infoline

India has one of the biggest health protection gaps amongst the countries in Asia. The gap is projected to increase by 12.3% annually to US$214 billion by 2020. India will face a shortfall in healthcare financing of close to US$43 billion in 2020, which will require additional fiscal spending or higher out-of-pocket funding by individuals.

The government and society will have to spend more in the future to make up for the growing demand for healthcare services due to higher income growth and a large population. In addition, out-of-pocket expenses account for nearly 60% of the total healthcare expenditure in India, with a very minor contribution from private insurance plans and a catastrophic event will wipe out one's entire savings.

Image: Global Health Expenditure Database, WHO, Swiss Re ER&C

With the emerging middle class estimated to grow almost ten-fold from 50 million people at present to 475 million by 2030, the demand for quality healthcare and speed to access services will be greater.

An expanding insurance market like India requires a sustainable and dependable healthcare and insurance infrastructure. Active co-operation and engagement among the industry and government is therefore required to build a robust healthcare eco-system.

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