COVID-19 has been leaded to unemployment of a large population worldwide. Thereby we have a vast group of people without income who might contract the disease. If those people do not possess the financial ability of paying the health services, the insurances can be their last hope.

Purchasing health insurance in case one is affected by Covid19 is imperative as medical bills can be extremely costly in the United Kingdom.

Dear Hermann Gruenwald

In Ukraine, we also have social insurance, but it not enough. Coronavirus treatment is too expensive and is not fully covered by social insurance. In addition, natural disasters such as floods are a big problem. The state is forced to spend significant funds to overcome its consequences. This increases the budget deficit. On the other hand, citizens are reluctant to buy insurance services, hoping for help from the state.

I believe that Ukraine needs a deeper penetration of insurance. But in modern conditions, this is a big problem.

Best wishes, Iryna Kondrat

Daer Mohammad Hossein Razizadeh Michael Halim

Thanks for your reply. I agree that insurance can be the last hope in the time of the pandemic. However, insurance is still not widespread in Ukraine. And it is unclear how the pandemic will affect the demand for insurance.

Best wishes, Iryna Kondrat

Iryna Kondrat

Dear colleague, in various types of countries different factors impact people's decision to buy insurance.

In a developed economy, insurance is bought with the objective of protecting the future. But in a developing economy, insurance is bought with the objective of getting tax benefits and other benefits attached to it. This is because, in a developing economy, insurance is a product bought only by the so called 'rich' and 'elite' classes.

The second part of your question is even more interesting i.e. how Corona virus is changing the demand for insurance.

Well, in a developed country, people are afraid. Now because of the Corona virus, there is a confusion in the markets. In such situations, people tend to depend on the government more than themselves. So the Corona virus is expected to decrease the demand for insurance in such countries. But the picture is different in developing countries. In these countries, insurance is a commodity that is purchased only by the upper sections of the society. These sections always have a lot of money in their hands. Secondly, when due to confusions in the markets, the price of insurance (like all other products) comes down, the upper classes will use this opportunity to buy more of the product by paying less price for it. So in countries like India, Bangladesh, Nepal, Bhutan etc. demand for insurance has already started growing.

Thank you.

Best regards,

Anamitra Roy.

Dear Hermann Gruenwald

Treatment for coronavirus in an infectious disease hospital in Lviv costs 4,000 hryvnias or 125 euros per day. The average pension of a pensioner is 3,000 hryvnias or 94 euros per month. Do citizens, and especially pensioners, have enough money to buy all the necessary drugs? The question is rhetorical.

In Ukraine, we have a problem with health insurance. Basically, insurance is valid until a coronavirus is diagnosed. Since on March 11, the WHO recognized the situation with the Covid-19 pandemic, and according to our legislation it is considered force majeure, this is not an insured event. In fact, insurance has all the legal circumstances to refuse payment, National Financial Services Commission states.

Our private insurance medicine is in an embryonic state. If the state had listened to medical law specialists and introduced a viable private health insurance system not only for individual insurers over the past 15-20 years, then it would be possible to add to the general list of diseases, the treatment of which is covered by insurance, such viruses.

Yours sincerely, Iryna Kondrat

Dear Anamitra Roy

I completely agree with you that people in developing countries face much greater difficulties than in developed countries, especially during a coronavirus pandemic.

Today in Ukraine we do not see a significant increase in demand for insurance. Demand for life insurance before the pandemic was low.

Before the pandemic, people mostly bought insurance to save a certain amount of money and were satisfied with a small amount of benefits in case of injury or illness. However, now - the interest in the medical part of the policy prevails.

People are willing to pay higher insurance premiums to have a larger amount of insurance payment.

Thank you for your reply.

Best wishes, Iryna Kondrat

Dear Remi Chukwudi Okeke

The pandemic has deepened the inequality that exists in the world. There are two global trends in the sense of inequality. The first trend is that poor countries are gradually catching up with the rich. If you look at China in the 1970s and 1980s, it was an extremely backward and poor country. China is now richer than ever and is recovering from a pandemic. The second trend is that although the gap between countries is narrowing, inequality within countries is widening. This is happening in Ukraine, in the United States and in China.

Therefore, regarding the first trend, the covid-19 did not change the picture globally. Poor countries have suffered great losses, but they are less than the losses of rich countries.

Regarding the second trend, interesting things happened. Again, I will give the example of the States. When money was paid from the federal government, it was received by 80-85% of the population - even though the property income test was conducted. These were mostly low-income families. So, because of these payments, the poverty rate in the States has decreased. This was the unexpected result of these fiscal injections into the economy.

In other countries, the situation is more complicated because these surcharges have been structured differently. For example, in Ukraine, I have not heard of any serious money being paid to low-income households. Therefore, it seems to me that in poor countries, inequality within countries has increased and will increase. Because if you are educated, work in an office or can work remotely, you are much more protected from covid-19 - both economically and in terms of health care.

Thanks a lot for your reply!

Yours sincerely, Iryna Kondrat