How can health insurance and network mutual aid break through the temptation of 2 trillion market prospect?

 How can health insurance and network mutual aid break through the temptation of 2 trillion market prospect?

According to the data of China Insurance Regulatory Commission, from January to March 2020, the premium income of health insurance business in the insurance industry was 264.076 billion yuan, up 21.58% year on year; in March, the premium income of health insurance business was 109.838 billion yuan, up 20.83% year on year, with the fastest growth.

Further, among the property insurance companies, from January to March 2020, the premium income of health insurance business was 51.8 billion yuan, accounting for 14.38%; in March, the premium income of health insurance business was 21.5 billion yuan, accounting for 15.64%, becoming the largest non auto insurance business.

The rapid development of health insurance business has shown signs for a long time. In 2019, the premium income of health insurance business in the insurance industry increased by 30% year-on-year, becoming the fastest-growing business among all categories of insurance. Meanwhile, professional health insurance companies grew 71% year on year, becoming the fastest growing professional insurance companies.

According to this target, Tianfeng Securities said that the compound growth rate of endowment insurance and health insurance will be about 20% in 2020-2025. In the future, health and pension products and services will become an important focus of the pension insurance system. Huge market demand and sustained policy support will promote the rapid development of commercial pension insurance.

Because of this, health insurance business has become a favorite track of capital. From January to March 2020, seven companies in the fields of health insurance and science and technology, including Nanyan technology, Jinniu technology, nuanwa technology, insurance geek, onemind technology, mass insurance health, insurance inspection and cccis China, completed nearly 600 million yuan of financing. The frequency and amount of financing were higher than that of the same period last year.

From the past experience, McKinsey consulting pointed out that after the end of SARS in 2003, a variety of insurance innovative products appeared, and the health insurance business even saw a high growth of 100% to 300% for several consecutive months. However, after 2004, the growth rate of life insurance, health insurance and accident insurance slowed down significantly, while the growth rate of property insurance, especially enterprise property, liability and cargo transportation insurance continued to increase significantly.

The cost of compensation keeps increasing

The rapid development of health insurance also has hidden concerns.

Facing the fierce market competition environment, health insurance not only has serious homogenization, but also reduces the premium, relaxes the underwriting conditions and shortens the waiting period. When consumers are insured, they only rely on the customer notification as the main screening means of insurance risks.

This is not only easy to cause disputes between consumers and insurance companies, but also increases the risk of adverse selection of insurance companies.

According to the 2018-2019 personal insurance product research report released by China Re life insurance, since 2016, as the online red star in health insurance, millions of medical products have become the indisputable business of Companies in the personal insurance market. However, there are also a series of risk points in this kind of products. With the rapid expansion of product premium scale and customer group, these risk points gradually appear.

Specifically, millions of medical products are expense reimbursement medical products. On the one hand, many details of the product form will affect the medical choice of the insured, which will directly affect the medical process and product compensation; on the other hand, because the insured has a deeper understanding of the product, the use of potential risk points of the product is gradually strengthened. It is estimated that the cost of compensation for millions of medical products will continue to increase.

At present, insurance companies are trying to break the situation, for example, by increasing the use of science and technology, deepening external cooperation, realizing the information interconnection, data sharing and service interworking between payers and service providers, improving the medical experience of consumers and the efficiency of claims settlement, and reducing the management cost of insurance companies.

Strong competitor of network mutual aid

In March 2020, the State Councils opinions on deepening the reform of the medical security system pointed out that by 2030, a medical security system with basic medical insurance as the main body, medical assistance as the foundation, supplementary medical insurance, commercial health insurance, charitable donation and mutual medical assistance will be built. The opinion also pointed out that social charity donation should be encouraged, the strength of charity medical assistance should be mobilized as a whole, and the orderly development of medical mutual assistance should be supported.

According to the white paper of network mutual aid industry released by ant Financial Services Group Research Institute, the actual number of participants of Chinas network mutual aid platform in 2019 is 150 million, which is expected to reach 450 million in 2025, covering about 32% of Chinas 1.4 billion population.

The reason why online mutual aid is popular is that consumers dont approve insurance companies or insurance practitioners very much; its convenient to join the online mutual aid process, so they dont need to pay at the beginning of the period; and its that many consumers join in a charity mentality.

According to the white paper, 79.5% The annual income of the participants was less than 100000 yuan, 68% of the respondents did not have commercial insurance, and 72% of the participants were distributed in the third tier cities and below.

In the field of health insurance, the age and disease risk of different groups of people are different, so it is difficult to have a guarantee product to cover all groups of people except for universal health insurance. In this regard, network mutual aid is further subdivided. For example, meituan mutual aid is a serious illness guarantee for young people aged 18-39; mutualbao recently released the chronic illness mutual aid plan, which is the third independent mutual aid plan launched by mutualbao after the serious illness mutual aid plan and the elderly cancer prevention plan.

According to the incomplete statistics of 21st century economic reporter, Alibaba, relaxed, shuidi, meituan, 360, Didi, Sina, Baidu, Suning and other enterprises have all deployed network mutual aid. More importantly, many Internet companies regard internet mutual aid as a springboard to enter the insurance industry.

However, network mutual aid also leads to many disputes. It needs to be emphasized that the network mutual aid plan is not a strictly insurance product. Do not neglect the long-term commercial insurance guarantee because you have participated in the network mutual aid plan; the network mutual aid platform is not an insurance company, and there is no regulation on withdrawing insurance benefits, meeting the solvency requirements, etc.

Long term product ready

Before that, due to the lack of explicit support of the rate adjustment policy, when designing and developing medical insurance, insurance companies could only develop one-year or very limited (such as within six years) medical insurance products, and upgrade new products with the mode of stop selling old products to cope with the high medical expenses caused by the future medical inflation and medical technology progress. This is also the biggest concern of consumers for medical insurance products. They are worried that insurance companies will stop selling insurance products at will, which will lead to their inability to obtain necessary medical insurance in the future.

Yang Zheng, chairman and CEO of Ping An health insurance, said that the product form of long-term adjustable premium guarantee is in line with international health insurance, which provides insurance companies operating long-term health insurance with system guarantee to deal with long-term medical inflation and other compensation risks, fundamentally solves the problem that insurance companies dare not try to develop long-term products before, and promotes the diversified development of health insurance products To solve the problems of short-term risk clustering and homogenization.

The notice has made it clear that the insurance companies should develop long-term medical insurance products with adjustable sales rates, formulate methods for adjusting long-term medical insurance rates, and make clear the trigger conditions, internal decision-making mechanism and workflow of rate adjustment. The trigger conditions for rate adjustment should be clear and objective, including actual compensation, medical inflation, and major changes in national health insurance policies.

At present, PICC Health Insurance on Alipay has guaranteed life insurance coverage with adjustable rate of life insurance, which can increase the insured amount by 200 thousand yuan per year, up to 5 million yuan. According to the product terms, the first rate adjustment time is no earlier than 3 years when the product is officially launched, and the upper limit of each rate adjustment is 30%. This product is currently in the grayscale test phase.

Zhong Peng, general manager of life insurance (health insurance) management department of Yongan insurance company, said that the competition of health insurance will eventually move towards the competition of risk control ability. Only by strengthening the construction of professional ability and controlling from product development, sales, underwriting, claim settlement and cost control, can insurance companies make the loss ratio and cost ratio within the acceptable range, so that the rate of medical insurance will slow down with medical inflation Slow rise, maintain the old customers, attract new customers and maintain the stability of operation.

Source: responsible editor of 21st century economic report: Yang bin_nf4368