Indians are more likely to have a vehicle or life insurance than health insurance, according to a survey by private research firm, Chrome Data Analytics and Media (CDAM). Only 31% of Indians had medical policies independent of those provided by their employers in spite of nearly half the survey respondents admitting to having faced a “financial emergency” due to medical needs.

This was because the bulk of Indians weren’t correctly estimating the potential pitfall — of exorbitant bills — from not having insurance and only saw it from the lens of tax benefits. “Even among those who did have health insurance, most had covers below 2 lakh which in many cases doesn’t cover a serious ailment like a heart transplant,” said Pankaj Krishna, Founder, CDAM. While a vehicle insurance was mandatory, a life cover too was popular because of tax benefits and not due to having a succession plan in place, he added.

The survey polled about 4,000 people — 51% of them women — from Delhi, Mumbai, Kolkata, Chennai, Pune and Bengaluru. While some had multiple policies, it emerged that 41% of those interviewed had a life insurance policy and 37%, one for their vehicle. Only 36% had a health cover. Moreover, 87% of those considering health insurance were only doing so to save tax, the survey reported.

The number of lives covered under health insurance policies during 2015-16 was 36 crore which is approximately 30% of India's total population, according to the Indian Brand Equity Foundation.

Indians are also known to spend a significant fraction of their health expense out of their own pockets. 89% of health expenditure by India, in 2014, was out-of-pocket as compared to a global average of 18%. Also, government contributed no more than 30% of individual health expenditure in India according to a 2014 — the latest — assessment by the World Health Organisation.

The Chrome study also found that of all the government-sponsored schemes on offer, the Pradhan Mantri Suraksha Bima Yojana elicited the most recall. Another scheme, the Rashtriya Swasthya Bima Yojana (RSBY) offers medical insurance up to ₹30,000 for a family of five living below the poverty line (BPL) — defined as the ability to spend ₹33 per day in urban India and ₹27 per day in rural. It is, however, limited to inpatient treatment or hospitalisation. This scheme elicited the 3rd-largest recall among respondents.