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Integrated Insurance Scheme, Gujarat
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Subject Area="Health financing." Objective="Mobilising community participation."
Details for Reform Option "Integrated Insurance Scheme, Gujarat"

Background: This Community Based Health Insurance Scheme is run by the Non Government Organisation (NGO) Self-Employed Women Association (SEWA), based in Ahmedabad, Gujarat. One of its primary activities is providing financial services for women and this was widened in 1992 to include health insurance as part of a wider insurance package including life, accident and asset insurance. Action: The scheme initially targeted just women in the informal sector but now includes men too. Members must be between 18 and 60 years old and a member of the SEWA union. They are asked to pay INR 85 per annum. In addition, women members can become lifetime members by paying a fixed deposit of INR 1,000 and the interest on this is used to pay the annual premium. The deposit is returned to her when she turns 60. The scheme covers: (i)inpatient care (ii)hospitalisation cover, plus one-time payment for denture and hearing aid. Members can use any kind of hospital, public, private or trust. (iii)Delivery benefits for fixed deposits members. There is a cap on reimbursement of INR 2,000 per year. At the time of discharge, the member must pay for the bill and apply for reimbursement from the scheme. Services excluded include pre-existing conditions, normal deliveries and conditions related to HIV/AIDS. The scheme is managed by SEWA which purchases medical insurance from a Government Insurance Company subsidiary National Insurance Company (NIC) and ICICI Lombard. Results: Membership has grown from approximately 5,000 in 1992-93 to 30,000 in 2000-01 to 100,000 individual members in 2005, covering approximately 17%, or one in six, of the population. However rates of utilisation have been low with approximately 18 claims per 1,000 members per year. In 13 years, 27,046 women have received INR 50 million in claims. Reimbursement takes place on average just over three months after discharge from hospital depending on when the claim is made. Since the scheme started, premiums paid by annual members plus interest from the fixed deposits of lifetime members has always exceeded medical claim payments. However if the costs of administration and social marketing are included, the amount collected through premium may fall short of covering the entire cost of the scheme.

Cost SEWA obtained an INR 10 million original corpus grant fund from the German Government to help set up the project. Current running costs are INR 15 million per annum, supported by the premium, the Consultative Group to Assist the Poor (CGAP) and the Ford Foundation.
Place Eleven districts of Gujarat since 1992. Has since been extended to Madhya Pradesh, Rajasthan, Uttar Pradesh, Bihar, Delhi, Kerala and Tamil Nadu.
Time Frame One year for core infrastructure but it took 14 years to reach the present level of organisation, human resources and infrastructure.

Increased demand: Insurance creates demand for government health services. Long-term cover: By linking insurance to other financial services provided by SEWA (savings and credit), the scheme provides longer-term cover. Economic support: Provides essential financial support during crises. Promotes planning: Encourages women to plan their future through insurance and promotes organisation and cooperation within the community for better financial security. Generates jobs: Insurance promotion can be a source of employment. Health promotion: The scheme is linked with health programmes to help promote health care and prevent spread of disease.


Prepayment concept: Members have to accept that to be part of an insurance scheme, they must pay for a service that they might not use. See comments box. Low awareness: Members need to be reminded that they insured for their health. Many remember they have life insurance but forget they have health insurance. Promotion costs: Promotion and marketing costs are high when insuring the poor as are the processing of claims. Inflation: Premiums can only be increased very gradually.


Social infrastructure: A network, built on trust, of poor women. Capable team with a variety of skills (financial, marketing, health management). Funds. Technical support of an actuary.

Who needs to be consulted

Central Government (who provided the original social fund, NIC). Community members. Trade unions. Development partners (in this case the Government of Germany, CGAP, Ford Foundation, International Labour Organisation (ILO)).



The life and accident components of the scheme are sustainable but the asset and health components are not yet sustainable. The administrative costs still require grants.

Chances of Replication

The scheme began just in Gujarat but has since been extended to other states – Madhya Pradesh, Rajasthan, Uttar Pradesh, Bihar, Delhi, Kerala and Tamil Nadu.


SEWA carries out an annual, intensive campaign to promote its insurance package at grass-roots level. Administrators estimate that it takes three face-to-face visits before members can grasp the concept of insurance.


Submitted By

Clare Kitchen, Research Consultant, ECTA, New Delhi, November 2005.

Status Active
Reference Files
EPW (Akash).pdf Akash Acharya, M Kent Ranson: Health care Financing for the Poor: Community-based Health Insurance Schemes in Gujarat. Economic and Political Weekly, September 17 2005.
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