Insurance, Healthcare and Public Welfare Post COVID-19

By Rishabh Dev Sharma

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COVID-19 has not discriminated in terms of whom it has infected, nor which sector it has hit the hardest. This crisis is different from the crises of late 1920’s and 2007-08 as it has affected almost all social and geographical sections. Its impact has woefully spread worldwide and has largely contributed to the raging insecurity in terms of health, job and social interaction. The alarming infection and death rates have created a rampant need for insurance and public welfare to overcome the worldwide fiasco and to save the global economy from recession.

According to Economics Times, the EPFO (Employees Provident Fund Organization) withdrawals in India during April-July has hit 8 million out of which 5 million have been withdrawn for medical reasons which tells us that the people in India don’t consider insurance as important as it is.

As the worldwide economy has pummelled, the job loss rates have increased. The unemployment rate stands at above 14% (particularly in developed economies such as the USA, UK, Canada and Australia) and the unemployment claims at 2,000,000 in numbers.

Many workers had to face layoffs due to unfavourable working conditions in sectors like aviation, tourism, hotels and in manufacturing industries. The layoffs mainly include medium to low wage workers.

At present, healthcare service providers such as Apollo Hospitals in India and United HealthCare in the USA have increased 60% and 50% respectively since the trough of March. This can be represented by the healthcare infusion by the governments. The US insurance sector has registered a growth of 11% and the Indian insurance sector has seen a growth of 22% in the last 3 months and is estimated to outperform the pre COVID-19 period as the fear of going out of money for health and to cover various debts is on rise.

Public welfare programs have been initiated all around the world to combat recession and to control the virus. Welfare programs could be seen both in the form of fiscal measures and monetary measures. The US Congress passed trillions of dollars in fiscal programs, while the US Federal Reserve added trillions of dollars in monetary stimulus. Similarly, in India the economic package largely targeted collateral free loans, agriculture, healthcare improvements and insurance against various risks.

The conclusion is simply that insurance will be an important inclusion in the budget of every individual. Healthcare will certainly experience government and private infusion after COVID- 19 and public welfare, including various stimulus in consumer goods, education, agriculture and banking sectors for easy access to loans and credits, will receive more importance.

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Key Takeaways

· The pandemic has increased the need for insurance and public welfare

· Stocks of Insurance and Health companies have soared during the pandemic

· Will have to budget for insurance post COVID-19