Anushruti Singh
The MSME sector employs an estimated 11 crore people in India, and according to the IRDAI, only 5 per cent of the 6.3 crore MSME businesses offer insurance or are insured. Furthermore, approximately 90 per cent of MSMEs do not provide financial assistance for medical purposes to their employee’s families, and the majority of micro and small businesses do not provide financial assistance to their employees and their families.
In practise, MSMEs prefer basic coverage for personal accident and critical illness, with a focus on premium reduction and employee coverage. But the pandemic has changed things for the MSMEs in a positive way. They are now re-thinking their strategies on employee wellness, while driving the growth of the insurtech sector in India.
In a one-on-one discussion with SME Futures, Yogesh Agarwal, founder at Onsurity talks about how the new age insurtech players are changing the insurance industry, and how the pandemic has changed the viewpoint of MSMEs about employee wellness.
Edited excerpts
How has the employee benefits landscape changed for SMEs and MSMEs in the last couple of years?
The pandemic served as a reality check. It globally propagated the absolute necessity to be financially equipped to handle medical emergencies. Companies have understood that providing a healthcare benefit facility is critical during these times to retain employees in both white and blue-collared jobs. While insurance is still the more known and availed of offering, SMEs & emerging businesses are seeing additional value in wellness offerings like telehealth, mental well-being sessions, etc.
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However, India is still an underserved market for employee health benefits as a whole and more so in the SME segment. In 2021, a survey conducted by the management company, Redseer, found that only 72 million, or 15 percent of India’s overall workforce has access to corporate wellness and health programmes, most of which belongs to the larger enterprises & MNCs.
India’s overall workforce consists of 477 million people, 85 per cent of which comprises of unorganised, blue-collar employees. About 450 million employed people still lack an insurance cover of any kind, as the insurance market does not have solutions curated to the SME segment. Onsurity saw a gap and disrupted this space with a product which was not only easily accessible but also super affordable.
How has COVID-19 given a thrust to this space?
The pandemic caused a ripple-effect among people working in offices. So, if one employee was infected, chances were that multiple people were going to get infected. This meant that companies had to deal with multiple cases of medical reimbursement to support their staff at any given time. This created a big hole in a company’s pocket on top of the losses that they were dealing with already.
To prevent such occurrences and to ensure that the workforce was being taken care of besides the attrition, many companies started opting for group health insurance. However, the challenge that kept arising was of either getting access to the right product for smaller teams or of getting the right price while accessing the same. This led to issues like the blocking of working capital during times when businesses were not doing well.
Onsurity intends to act as a catalyst by equipping MSMEs and SMEs with the right solutions at an affordable price. Currently, the Onsurity membership begins at Rs 145 per month per employee, and includes telehealth, insurance, mental well-being programs etc. Insurtech firms have embraced disruptive changes across the customer experience and the distribution experience, and product and value-added innovations. With the help of technology, insurers are offering products based on demographics, individual behaviour and preferences, customer needs at various life stages, and real-time interactions. Today, a company with a team size of even 3 people can access the health benefits of the same quality that are available to larger teams.
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Are SMEs opting for larger covers/ covering more people etc?
Small enterprises face three challenges with regards to employee wellness which include focus, affordability and competence. SMEs want to simply meet the basic requirements when it comes to healthcare. But even in that context, the importance of preventive healthcare through our wellness benefits ensures that the SMEs have access to both healthcare and wellness benefits while spreading awareness about the same.
Additionally, at Onsurity, we have worked on creating a dynamic offering through our digital dashboard which supports everything from onboarding members, billing, multiple integrations, and membership management. It includes everything from discounted online medicine orders to lab tests, doctor tele-consultations, claim requests, reimbursements and wellness offers.
With rising health insurance costs, how can MSMEs access affordable health insurance?
In 2021, India registered the highest medical inflation rate among Asian countries at 14 per cent according to the Indian Health Insurance report released by Motilal Oswal Financial Services Limited (MOFSL) in May this year.
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While there are government health programmes for Indians below the poverty line, for the MSMEs, there were no custom-made products which could consider the issues faced by them while adopting health care products. Hence, Onsurtiy used tech to build India’s 1st monthly subscription led employee health benefits programme, with the intent to make it affordable. Monthly payments do not take out a substantial upfront cost from their working capital annually, which enables the companies to use their OPEX/CAPEX for other business purposes.
Are more SMEs opting for life insurance covers?
Healthcare that includes group term life insurance is not only more competitively priced, but efforts are being made to make it more widely available to serve this purpose. There is a rising demand for group life insurance covers as many companies saw a lot of casualties during the pandemic and feel morally obligated to provide compensation.
How do the tech-platforms offered by new age insurtech companies like Onsurity aid SMEs and how do they help them to claim insurance?
The whole customer experience, starting from the first communication to the actual services available to the end-user is completely digital, making the process completely seamless for the SME employees. The membership benefits are end-to-end available in the member-facing super app which includes all aspects of healthcare and wellness. Onboarding takes 2 hours, which is lightning speed in this industry. It has been made possible by technology and innovation through seamless onboarding, billing, and overall employee welfare management through the partner-facing web-based tool.
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Onsurity has a claim concierge team dedicated to help members through the claim process, which is assigned to each member once the claim request is made on the member-facing app.
This is a completely complimentary service where Onsurity ensures that the whole process is simpler and more convenient. We do it by providing support during the documentation process and the claim approval process, which is speeded up exponentially through this team so that the member can seek and concentrate on their treatment. This is available for both the cashless and reimbursement processes. Entire claim support is being provided to Onsurity members via the Onsurity App, which is again a disruption in itself.
