U.S. Supplemental Health Market Size to Hit USD 62.57 Bn by 2033

The U.S. supplemental health market size surpassed USD 36.80 billion in 2023 and is projected to reach around USD 62.57 billion by 2033 with a notable CAGR of 6% from 2024 to 2033.

U.S. Supplemental Health Market Statistics

• By Product, the hospital indemnity insurance segment generated more than 21.95% of revenue share in 2023.
• By Distribution Channel, the brokers segment contributed more than 60.55% of revenue share in 2023.
• By Demography, the individuals aged 65 and above segment dominated the market and accounted more than 96.95% of revenue share in 2023.

Supplemental health insurance is a type of health insurance that is proposed to provide additional coverage for services that are not covered by conventional health insurance plans. The aim of supplemental health insurance is to fill the gaps in traditional health insurance plans by covering certain expenses for which the policyholder is responsible. The rising healthcare costs, increasing prevalence of chronic diseases, and the shift towards consumer-driven healthcare are anticipated to enhance the growth of the U.S. supplemental health market during the forecast period.

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U.S. Supplemental Health Market Scope

Product Outlook

The dental sector is growing at a remarkable rate in 2023 due to awareness regarding oral hygiene. In 2021, national dental care spending in the U.S. accounted for $162 billion, which was a rise of 11% from 2020 (adjusted for inflation). Over 1 out of 4 (26%) adults in the U.S. face problems such as untreated tooth decay. A typical premium for dental insurance in the United States may be from $20 to $50 per month for an individual. For a family, dental insurance premiums range from $50–$150 per month. Dental insurance would cover aspects associated with gums and teeth.

U.S. Supplemental Health Market, By Product, 2022-2032 (USD Million)

Distribution Channel Outlook

The broker sector is expanding at a remarkable rate from 2023 to 2032. The brokers serve as an intermediary (or “carriers”) between insurance companies and consumers. Health insurance brokers serve customers with access to policy information, expert guidance, personalized options, and suitable recommendations. There are 881,500 licensed agencies and brokers operating in the United States. Health insurance brokers are popular among people who lack employer-sponsored insurance and self-employed workers.

U.S. Supplemental Health Market, By Distribution Channel, 2022-2032 (USD Million)

Demography Outlook

Individuals aged 65 and above are anticipated to dominate the supplemental health market in the United States. The expansion is due to the growing number of people of this age group opting for the policies. Along with this, various government policies favoring this age group are also expected to boost the market.

Furthermore, the Individuals Aged Below 65 with an Eligible Disability sector is growing at a remarkable rate. The growth is owing to rising cases of disability among the adult population in the United States.

U.S. Supplemental Health Market, By Demography, 2022-2032 (USD Million)

U.S. Supplemental Health Market  Dynamics

Drivers:

 Increasing Prevalence of Chronic Diseases
As per the National Center for Chronic Disease Prevention and Health Promotion, 6 in 10 adults in the United States have a chronic disease, and it is one of the leading causes of death and disability. These conditions mostly require medical care. Hence, supplemental health insurance plans assist in providing additional coverage for the management and treatment of these conditions. The rising prevalence of chronic diseases such as heart disease, cancer, and diabetes require additional services that are not covered by traditional health insurance plans. As a result, there is increasing demand for supplemental health insurance that provides additional benefits for these conditions.

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Restraint:

 Limited Awareness

Various customers are not aware of the advantages of supplemental health insurance and hence may not understand the benefits that these plans include. This limits the demand for supplemental health plans. Thus, insurers face various challenges in marketing their offerings. Additionally, the lack of health insurance plans awareness may lead to people paying for the expense of the medical therapy themselves. This may act as a hurdle in the case of huge medical bills due to the rising cost of treatments.

U.S. Supplemental Health Market Recent Developments

• In October 2022, Allianz announced the acquisition of Jubilee Holdings Limited in East Africa for a controlling interest in the general insurance business.
• In April 2023, AIG announced the agreement with Stone Point Capital LLC (Stone Point).
• In February 2022, Assurant and Tekion came into a partnership to enhance Digital F&I experiences in Automotive Retail.
• In January 2023, Humana acquired Doctors on Demand, a telemedicine provider.

U.S. Supplemental Health Market Companies

• Aetna Inc.
• Allianz S.E.
• American International Group, Inc.
• Anthem, Inc.
• Assurant, Inc.
• AXA Group
• Cigna Corporation
• Humana Inc.
• MetLife, Inc.
• Zurich Insurance Group AG

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