Traditionally, tied agents have been the primary channel for insurance distribution in the Indian market, supported by call centers to a certain extent. As agents of the government, public insurance companies could have played a major role in insurance for the poor. But unfortunately, this did not happen. At present, only 0.02 percent of the total insurable population could, somehow, be brought under this umbrella of health insurance. Amongst this, the quantum of health insurance in the rural market is a matter of opinion. Even the highly subsidized government sponsored Universal Health Insurance Policy has resulted in a serious market failure. In this context, this study is an effort to determine a unique solution to this problem and find out the nature of healthcare financing of the poorest cluster in rural West Bengal and indicate whether community-based health insurance could be a better option over the traditional agency network for introducing health insurance among the poorest cluster in rural West Bengal.

A large section of the rural poor in West Bengal simply avoid treatment for health implications due to their extreme poverty; as they are unable to bear the cost of treatment. Although they appreciate and feel the need for alternate source of fund for meeting the medical expenses, they are not inclined to take cover under health insurance. Even the Indian government's new policy initiative Universal Health Insurance Policy for the poor population has vehemently failed to penetrate the Indian rural market, as a whole. Even they reject the idea of involving NGOs or reputed social service organizations to help them in this regard. This psychological inertia is due to illiteracy, ignorance and neglect of the society that the poorest people experience. The poor servicing and incomprehensibility of health insurance by the poor people are also partly responsible for the failure. These factors finally culminated in the ultimate rejection of the product by the targeted mass.

In context to the weakness of the mean and heterogeneity of needs, when the entire population is looked at in low-income countries like India, it is possible to validate two assumptions (dominance of mean, and homogeneity of needs) within smaller groups of people, composed of individuals selected for their homogeneity at the point of entry into the group. In low-income countries, these groups are often referred to as community-based health schemes, and they are of particular interest when they operate a prepayment system replacing user fees and other out-of-pocket expenditures, which have been labeled as micro-insurance units.

Management Research Journal, Health Insurance Distribution, Indian Market, Public Insurance Companies, Rural Market, Health Insurance Policy, Indian Rural Market, Social Service Organizations, Micro-Insurance Units, Prepayment Systems, Mutual Health Organizations, Hospitalization Services, Non-Governmental Organizations, Risk Pooling, Health Insurance Schemes.