Public Healthcare System in Pakistan was not Sufficient to Meet the Demand, According to Timetric

17 Sep 2012 • by Natalie Aster

The Pakistani personal accident and health insurance segment is in the initial stages of development and accounted for just 4.5% of the total written premium of the overall insurance industry in 2011. However, the segment demonstrated a strong performance during the review period and grew from PKR3.2 billion (US$52.8 million) in 2007 to PKR5.1 billion (US$58.9 million) in 2011, at a CAGR of 12.3%. This growth was driven by the positive economic outlook, rising healthcare expenditure in the country, increasing government initiatives and growing consumer awareness about the benefits of personal accident insurance. The number of personal accident and health insurance policies sold during the review period grew from 2.3 million in 2007 to 3.5 million in 2011, at a CAGR of 11.1%. However, the public healthcare system in the country has not been sufficient to meet the demand in the country. The inadequate public healthcare system, coupled with rising numbers of infectious diseases, is expected to increase the scope of private health insurance over the forecast period.

According to the report “Personal Accident and Health Insurance in Pakistan, Key Trends and Opportunities to 2016” by Timetric, the government of Pakistan has adopted a number of important measures over the years to ensure the best healthcare facilities for the country’s population. In spite of this however, the total public expenditure on the healthcare system has not been sufficient enough to meet demand in the country and the public healthcare system in Pakistan has been inadequate in providing the proper healthcare services to the larger population. The contribution of public spending accounted for only 38.5% of the total healthcare expenditure in 2010, while the public had to contribute towards the remaining part of the expenditure in the form of either private health insurance or out-of-pocket payments. In addition, the country experienced a growing number of infectious diseases and the increasing cost of medical treatment made the treatment of diseases almost unaffordable for low income groups. These factors forced consumers to avail private health insurance plans in order to avoid any financial liabilities due to illness.

Report Details:

Personal Accident and Health Insurance in Pakistan, Key Trends and Opportunities to 2016
Published: August, 2012
Pages: 193
Price: US$ 1.950,00

The penetration level of personal accident and health insurance in Pakistan is very low when compared to other Asian countries such as India and China. The penetration level of personal accident and health insurance products in Pakistan stood at 0.03% of GDP in 2011, compared to India’s penetration of 0.21% and China’s penetration of 0.33%. The low penetration level provides a significant opportunity for growth in the country. By offering improved and attractive products to consumers, companies can expand their presence in the remaining untapped market.

The improved health awareness of the population of Pakistan resulted in an increase in healthcare expenditure during the review period. The healthcare expenditure per capita in the country grew from PKR1293.2 (US$21.2) in 2007 to PKR2170.8 (US$25) in 2011, at a CAGR of 13.8% during the review period. The overall healthcare expenditure increased from PKR226.9 billion (US$3.7 billion) in 2007 to PKR406.7 billion (US$4.7 billion) in 2011 and recorded a CAGR of 15.7% during the review period.

More information can be found in the report “Personal Accident and Health Insurance in Pakistan, Key Trends and Opportunities to 2016” by Timetric.

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