Why 'One-Size-Fits-All' Health Insurance Products are Unsuitable for Low-Income Persons in the Informal Economy in India

This paper hypothesizes that attractive health insurance must represent an optimum match between clients needs for health care, demand for health insurance, and available supply of health care. The study examines data from a household survey, conducted in 2005, among rural poor and urban slum dwellers in seven locations in India. The study finds marked differences in the medical needs, the ability and the willingness to pay for insurance and availability of health care across locations. It concludes that reasons for these differences are context specific and multiple. It also finds that aggregate consultation and medication expenses exceed hospitalization costs in all locations. It concludes that these variations cannot be optimized in a single partial benefit package and that each location needs a context-specific solution.