The landscape of global health insurance is expanding rapidly, expected to reach a staggering USD 5.6 trillion by 2032, as forecasted by Emergen Research.
While the world braces for this growth, Nigeria’s healthcare insurance sector, albeit growing, appears to be in an embryonic stage, grappling to match up with international benchmarks.
The global health insurance market has secured a solid footing with a value of USD 3.30 trillion as of 2022 and is projected to advance at a 5.6% CAGR. This growth stems from factors such as the increasing GDP and healthcare expenditure, an aging global population, the surge of chronic diseases, and the incentivizing policies of governments.
Key market players are forging significant partnerships and investing in innovations. The alliance between Star Health and Allied Insurance with Standard Chartered Bank aims to bring novel insurance products to India’s burgeoning market.
Additionally, mergers and acquisitions, alongside R&D initiatives by insurers, are poised to revolutionize product offerings, as evidenced by Future Generali India’s introduction of DIY Health and Humana’s acquisition of Inclusa, reflecting an industry in rapid evolution.
In contrast, Nigeria’s health insurance landscape, despite expectations to expand from $1.83 billion in 2022 to $3.53 billion by 2030 (8.6% CAGR), remains nascent. In 2019, Nigeria allocated a mere 3.03% of its GDP to national health expenditures, equating to roughly $71 per person.
The market is dissected into various segments, encompassing providers, coverage, plans, and end-users, with notable entities such as Leadway Health Insurance and Hygeia HMO steering the market.
The incremental growth in Nigeria is attributed to an expanding population, which signifies a vast untapped market, considering over 90% of Nigerians are uninsured.
Skyrocketing healthcare costs, driven by pricey medical technology and workforce, are necessitating the need for health insurance to help manage these financial burdens.
Governmental support, particularly through programs like the National Health Insurance Scheme (NHIS), is nurturing a conducive landscape for the insurance market to flourish.
Despite these drivers, the high cost of health insurance premiums, influenced by medical inflation, poses a substantial barrier to market growth. Issues such as claim approval rates and complexity in understanding policies, as highlighted by Pristyn Care Data Labs’ survey in India, mirror challenges likely faced by Nigerians as well.
The Nigerian market is keen on achieving the same growth trajectory as its global counterparts. The critical illness segment, leading in global market share, underscores the imperative for comprehensive coverage in Nigeria, where critical illnesses remain a significant health threat.
Optics – The health insurance sector globally is on an unprecedented upward trend, signalling a future of enhanced financial security in healthcare.
For Nigeria, the potential is vast, but the realization of this potential hinges on the country’s ability to amplify its healthcare infrastructure, increase insurance penetration, and continue to foster a supportive environment for health insurance providers.
As the world edges closer to a multi-trillion-dollar health insurance market, Nigeria stands at the crossroads, eyeing an opportunity for robust growth and a healthier future for its citizens.