According to a report by ASSOCHAM, the live music industry in India is expected to reach US$455 billion at a CAGR of 17% by 2024 and has the potential to grow at least 2x pre-pandemic estimates. According to another estimate, India is likely to have 350 million in-demand jobs by 2025, representing a huge opportunity for job seekers to capitalize and adapt to changing labor market dynamics. work. Currently, India has a pool of around 15 million freelancers assigned to projects in IT, HR and design. Moreover, India’s labor force is growing by about 4 million people per year. And since most of them are young millennials, they show a growing preference for gig contracts. This trend is expected to have a significant impact on the gig economy in the near future. Abhishek Poddar, Co-Founder and CEO of Plum, shares his insights into health insurance and how it’s now an essential service for gig workers:-
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The New Labor Code:
“India has recently witnessed a series of labor sector reforms with four brand new codes encompassing 29 central labor laws – some of them being century old laws. The Four Labor Codes – Wages Code 2019, Social Security Code 2020, Industrial Relations Code 2020 and the Occupational Safety, Health and Working Conditions Code 2020 together provide a simplified employment law regime that benefits both employees and employers. 2019 defines a construction worker as “a person who performs work or participates in a work arrangement and earns such activities outside of the traditional employer-employee relationship. The Social Security Code 2020 extends for the first time social security benefits like maternity leave, disability insurance, gratuities, health insurance, old age protection to workers in the booming labor space. country’s gig economy,” says Abhishek Poddar.
Explaining four reasons why health insurance is now an ‘essential service’ for gig workers, Poddar said: ‘The law now recognizes ‘gig workers’: the current labor law does not contain any provisions regarding insurance benefits to be provided to gig workers in India. However, the Social Security Code 2020 (“Code”), which has yet to be implemented in India, provides that gig workers will be able to enjoy social security coverage under the scheme. employee state insurance. In addition, the central government may regulate appropriate social security schemes for gig workers on matters relating to, inter alia, accident insurance, health benefits and any other benefits determined by the central government. . It should be noted that these schemes can be entirely financed by the contributions of the aggregators (as specified in the seventh annex of the Code) at a rate of at least 1% of the annual turnover of each of these aggregators. These aggregators include ride-sharing services, food and grocery delivery services, newspaper statistics services, etc.
It adds: “According to Ashima Obhan, Partner Obhan and Associates, “Traditionally, gig workers were not recognized as ’employees’ and benefits that were of the same nature for employees were not extended to them. The new labor codes have turned this concept on its head. Under these new codes, gig workers are entitled to insurance benefits. Although the implementation date for these codes has yet to be announced, organizations are working to ensure compliance with the new codes.
The platform economy is growing:
“The rise of the platform economy has had a huge impact on the job market globally and in India. Freelance work, freelancing and the gig economy are growing and will continue to do so. In a market tense work, any company that is serious about scaling has to provide compelling benefits and security to its staff, so insurance is the most essential security to provide.Recently, a public interest litigation ( Indian Federation of App Based Transport Workers (IFAT) v. Union of India) was filed in the Supreme Court of India in September 2021, for the extension of social security legislation to workers at the application and app-based workers. This is an important step to protect their rights and prevent exploitation,” he added.
Technology and remote work are likely to create many more “gig workers”
“According to a KPMG report, today’s advanced online digital platforms, along with the proliferation of mobile apps, have paved the way for the gig economy by enabling instant matching of supply and demand, bringing service providers together with the people who need them. Basically, there are many types of digital gig platforms: work-based platforms, which allow workers to provide activities, perform tasks such as driving a car (e.g. Uber), delivering packages and food (e.g. Swiggy/Zomato), aggregation platforms for on-demand and blue-collar work (Apna), platforms based on jobs for gig workers (Fiverr) and many more Labor economics is also a B2B market, highlighting transactions between different sectors and the need for new products insurance,” he explained.
This is the right thing to do:
“More than 80% of Indians have no health coverage, according to the 75th National Sample Survey. Among rural Indians, 85.9% have no coverage of health expenses. In the case of urban Indians, c is slightly better at 80.9 percent.” hundred. Medical expenses for hospitalization, according to this survey, are significant. On average, a rural household spends Rs 16,676 per year while it is Rs 26,475 for an urban Indian. With no health insurance coverage and high expenses, Indians dip into savings or borrow to pay household medical bills. In rural areas, 80% of households relied on their savings to finance their medical expenses, while 13% of people borrowed from various sources. In urban areas, 84% of people depended on their savings and income while 9% borrowed to pay for medical expenses,” he said.
“To sum up, gig work is here to stay. The sooner we recognize this new form of work and provide new era benefits, insurance being the most essential, the faster we progress as an economy. “
2022 outlook for Insurtech:
“Going forward in 2022, like fintech, InsurTech is also striving to make the whole process of issuing an insurance policy and claiming it quick and easy for users. The industry is ready and moving more and more online and becoming mobile first.The pandemic has made people more aware of their health and wellbeing.People have realized the value of mobile fonts. insurance. This has pushed many insurance companies to adopt digital channels to reach end users. Many companies/employees have realized the benefits of insurance and are picking up various types of coverages for COVID19, hospitalizations, home care and co-morbidities Group health insurance is once again in the spotlight, with the new variant we are seeing an upsurge in demand for insurance,” he concluded.
(Disclaimer: Opinions/suggestions/advice expressed here in this article are investment experts only. Zee Business suggests its readers consult their investment advisors before making any financial decisions.)