Soaring Costs of Medical Treatments Fueling Popularity of Healthcare Insurance

Posted by Pramod Arya on December 8th, 2021

Due to the rising incidence of chronic diseases and the surging costs of medical treatments and healthcare, healthcare insurance is rapidly becoming highly essential across the world. According to the World Health Organization (WHO), chronic diseases are one of the major causes of disability and death across the world. Furthermore, the organization predicts that 43.0% of the total diseases around the world will be chronic diseases by 2020. This will push up the healthcare spending of people in the future.

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The high occurrence rate of these diseases is augmenting the financial burden on people, which is, in turn, fueling the adoption of healthcare insurance. People are investing heavily in health insurance these days, mainly for curtailing their out-of-pocket expenses on medical treatments and healthcare. The ballooning geriatric population is the biggest factor responsible for the soaring incidence of chronic diseases across the globe. This is because elderly people are highly vulnerable to chronic ailments.

As per the World Population Prospects report published by the United Nations (UN) in 2017, the population of geriatric people is predicted to grow at a faster rate than that of the younger people in the coming years. According to the report, there were 962 million people in the age bracket— 60 years and above in the world in 2017. This number is predicted to grow to 1.4 billion and 2.1 billion by 2030 and 2050 respectively.

Furthermore, this number is predicted to rise to nearly 3.1 billion by 2100. Because of these factors, the demand for healthcare insurance is rising rapidly all over the world. This is, in turn, causing the expansion of the global healthcare insurance market. The value of the market is predicted to grow from .7 trillion to .2 trillion from 2018 to 2024. The market is also expected to progress at a CAGR of 4.3% between 2019 and 2024.

Geographically, the healthcare insurance market would demonstrate the highest growth rate in the Asia-Pacific (APAC) region in the upcoming years, as per the estimates of P&S Intelligence, a market research company based in India. The key factors driving the progress of the market in this region are the increasing public awareness of healthcare and healthcare insurance, the rising incidence of chronic diseases, thriving healthcare industry, and flourishing medical tourism industry in the region.

Hence, it can be said with certainty that the popularity of healthcare insurance would surge all over the world in the upcoming years, mainly because of the increasing costs of healthcare, the soaring geriatric population, and the rising incidence of chronic diseases around the world.