Affordable financial protection against health shocks

Around 1.6 billion people are pushed into poverty, or deeper into poverty, by out-of-pocket healthcare costs every year (WHO, 2022 data). In the communities where Health Finance works, a health crisis can take many forms: a complicated childbirth, a child's serious illness, an accident, or a chronic condition that worsened because earlier care was delayed through lack of knowledge, access or affordability. Each carries a financial cost that most low-income families have no way to absorb.

Families face a dual crisis when a health emergency occurs: the direct cost of treatment, and the absence of any affordable way to pay for it. Formal health insurance is largely inaccessible for low-income households. Research by Health Finance's local partner Uplift with nearly 39,000 low-income households in Mumbai found that less than 1% had any form of health insurance coverage. Public insurance schemes exist but coverage gaps are significant, and claims processes frequently exclude those with low literacy or irregular incomes.

Savings are low and unstable. The easiest alternative is borrowing from informal moneylenders at interest rates of up to 200%, but a loan at 200% just means the health crisis becomes a financial crisis, pushing families into a debt cycle that lasts for years.

Part of the challenge is cultural as well as structural. In communities where affordable health financial products have never existed, there is little tradition of saving for health or insuring against medical risk. Families manage illness reactively, meeting costs as they arise rather than protecting against them in advance. Shifting that pattern toward prevention and financial planning is a gradual process, requiring sustained community engagement alongside the financial products themselves.

The consequences of the current system extend beyond finances. Families delay or avoid care until conditions worsen, sell productive assets, or withdraw daughters from school to cover costs. For women, who typically manage family health while having less control over household finances, a single health emergency can reverse years of economic progress.

Health education is part of the answer. When women gain the knowledge to recognise warning signs and seek care earlier, outcomes improve. But knowledge alone is insufficient without affordable financial tools to act on it. A woman who knows she needs care, and cannot pay for it, faces a different version of the same crisis. The Health Finance Hub model addresses both: integrating health education alongside health financial products, so that knowledge and the means to act on it reach families together.