Gen Z, rural women driving India’s health insurance shift: Finhaat CFO

As rising healthcare costs make financial protection more important than ever, Sandeep Katiyar, Co-Founder and Group CFO of Finhaat, is working to ensure that even the most underserved communities aren’t left behind.

Having spent years in the heart of India’s rural and agri-finance ecosystem, Sandeep understands the everyday struggles of families facing medical emergencies without a safety net. That’s why he’s passionate about making health insurance simple, affordable, and accessible especially for Gen Z and women in smaller towns across states like Uttar Pradesh, Gujarat, and Maharashtra.

Through Finhaat based out of Pune, he’s not just building financial products, he's building trust where it matters most as a B2B financial services provider in rural, Tier 3, and Tier 4 cities. He told Bizz Buzz in an exclusive interview that as health costs continue to rise and awareness around financial protection grows, India is witnessing a quiet but significant shift in the health insurance landscape led by Gen Z and women. "In the past two to three years, there has been a marked increase in the adoption of low-cost health insurance plans," he said.

What’s driving the notable uptake of low-cost health insurance among women in rural and Tier 3/4 India?

The Government of India has a key focus on universalising insurance. Health expenses form a big part of unplanned expenses. High hope is often one of the big reasons for driving lower income families to poverty. In such a scenario, we have observed that: increased awareness campaigns and government initiatives have improved access to health insurance. The affordability of low-cost plans makes insurance accessible to low-income households.

Moreover, increasing financial literacy through campaigns by the government and financial institutions are helping increase the adoption of financial protection against health emergencies. Customised micro insurance products and delivery systems being designed to meet the specific needs of this population – be it compensating for work day loss, accounting for expenses incurred by caregiver or simplifying the process for accessing insurance at the local level.

Are there particular features (like hospicash, OPD, or teleconsultation) that are proving to be game-changers?

Increasing financial literacy and the awareness that one’s health is key to your well-being both physically and financially have led people to be more open to exploring alternatives available to them. Features like teleconsultation, diagnostics are significantly boosting appeal, especially for managing chronic conditions and reducing out-of-pocket expenses.

Hospicash features are designed to provide benefits around customisable plans helping to cover expenses around hospital stay – workday loss compensation, specific features like accounting for treatment at a registered hospital instead of a networked hospital at tertiary centres – takes into consideration the unique challenge that this population faces. financial support during hospital stays, which resonates well with rural populations. The convenience of telemedicine reduces travel and time costs, making insurance more practical.

How critical is the role of trusted last-mile advisors or agents in driving adoption in Tier 3/4 towns?

Insurance penetration has been a key challenge for a long time. This can be attributed to several reasons: Bad product fit – urban products being introduced at lower price points for this segment without accounting for their required benefits - Absence of a trusted delivery channel that can provide services across geographies - Lack of a trusted service provider that can facilitate post-sales support for claim and settlements

A trusted service provider can transform the process of adoption by facilitating all of the above. From understanding the requirements in terms of products, to dispelling misconceptions to facilitating onboarding, claims assistance, and providing ongoing engagement – there is an end-to-end servicing.

How is Finhaat addressing the trust deficit or product awareness challenges in non-metro geographies?

With its tech-driven approach, Finhaat has created proprietary distribution infrastructure that partners with institutional partners and individual financial partners (retail PoSP agents) that hold trust on the ground to offer a completely digital, seamless experience of delivery and end to end servicing of the product that has been curated to meet the needs of the target segment.

Its unique understanding of the insurance landscape along with the distinctive needs of the target segment – Finhaat has been able to curate relevant products in partnership with different Insurance Companies.

Finhaat's B2B SaaS-based digital platform provides its partner institutions with ease of implementation and customer servicing for its end customers on the ground. A suite of unique APIs, custom-built for the partners for instant policy issuance and seamless end-to-end claims process have helped increase adoption of insurance and reach more end customers.

FinSAAS is available as a full stack product as well as a plug and play model where specific services like Claim, Issuance, Institutional Insights can be customised to be used as a singular service.

What unique preferences or demand signals is Finhaat seeing from places they are present in rural India?

We see a demand for insurance products that are simple to use and access. Embedded products related to Parametric, Health and Life are sought after.

How is the health insurance sector growing in India with the Centre and the State governments offering free treatment to many categories as a security measure?

The sector is expanding rapidly, driven by increasing health awareness and insurance penetration. The government schemes complement private insurance, but demand for additional coverage persists for non-covered needs.

How big is the health insurance sector in India? What are the growth projections?

Looking ahead, the gross written premium is anticipated to experience a compound annual growth rate (CAGR) of 6.50 per cent between 2025 and 2029. This growth trajectory is expected to culminate in a market volume of US$124.31bn by 2029. (source: statista). Rural and Tier 3/4 markets are expected to witness higher growth rates, driven by increased awareness and product availability.

How do you see the potential of the low-cost health insurance sector? What are the challenges it's facing and what support do you expect from the government to improve the existing ecosystem?

The potential is substantial, given the large uninsured or underinsured population in rural India. Challenges include trust deficits, low product awareness, limited distribution channels, and affordability concerns. Support from the government could include further subsidization, awareness campaigns, streamlined regulatory policies, and integration with existing public health programs to enhance reach and credibility.