Thursday, December 25, 2008

Is overseas travel insurance policy issued by Insurance Companies of Ukraine and Belarus is Valid?

Is overseas travel insurance policy issued by health Insurance Companies of Ukraine and Belarus is Valid? Hindustan Times of Dec 25, 2008 has raised a very interesting question whether overseas travel health insurance policy issued by Insurance companies of Ukraine & Belarus is valid. IRDA has initiated information gathering exercise and we can expect some action in the coming weeks. We foresee this can be in the form of posing questions to the company which has been selling the products. We do not foresee any action against the Insurance co’s as these are not based in India. Points in favor of foreign insurance co are;

1.If Indians are permitted to buy air tickets worth any amount from Foreign airlines then why they should not have the freedom to buy Overseas Travel Insurance from a foreign company.
2.Many foreign insurance co’s (including a BUPA subsidiary )have been advertising in Indians press and selling Health Insurance for Indians living in India .According to information available to us no action was taken by IRDA against them.
3. Let the Indian Insurance co’s face the competition and come out with suitable products, pricing and service level. Point against foreign insurance co is;
Indian customers do not know about the financial strength of this co and it is the duty of IRDA to protect the interests of Indian Citizens. We will be pleased to have the comments from you.

Is overseas travel policy issued by Ukraine/Belarus insurance co's to indians valid

Hindustan Times of Dec 25,2008 has carried the news which raises the question whether Overseas Travel Policy issued by Ukraine & Belarus Insurance Companies to Indians valid.

IRDA has initiated information gathering exercise.

Points against the issue of such policies is;

1.Insurance co's not registered with IRDA.The co selling the products is not licenced by IRDA.

Points in favour of such policies are;

1.As Indians we are permitted to travel by any international airline

Wednesday, December 24, 2008

Portability of the Healthinsurance policy is coming

Yes,portability of the Healthinsurance policy is coming.It maens you can cahnge the insurance co when it comes to renewal.We feel this will be of help to those who are in the lower or younger age group.Even today this group has no difficulty.

The question arises -will it help those who are in 60+ age group.We doubt it will be so as the premium variation and different policies with respect to "No Claim Bonus" will be a stopping factor.

Wednesday, December 17, 2008

Indication that group health insurance rates will go up by 50%

We have been of the view that Individuals /families are neglected wherelse group health insurance policies are issued with better terms and lower rates.

The Economic Times od Dec 17,2008 has carried a news item according to which ratio of claims and servicing expenses to total premium figure of Group policies is 160%(Ref Mr Sandeep Bakhshi ,CEO, ICICI Lombard).

This news item also informs that where claims have been high the policies are being cancelled.

We are pleased to know that Insurance industry has started facing the truth and has started taking steps in the right direction.

Sunday, December 14, 2008

Does Oriental insure someone who is 75+

We have received comments from some of our website surfers

Group Health Insurance Rates to go up in 2009

Many people wish to know whether the premium rates will go down in the year 2009.No indications are available as far as individuals /families are concerned.

It is becoming clear that Group Health Insurance policies have resulted in claims of over 130% and many Insurance co's are considering to increase the rates during 2009 by 30 to 40 %.

Sunday, September 14, 2008

Who killed health care" is a good reading

I have come across a book "Who killed health care" by Regina Herzlinger .Regina is a Professor in Harvard Business School and has covered various aspects of health care as well as health insurance industry in that country (USA).It is good to know that India is mentioned at various places in this book ,where health care of good level at a fraction of USA costs is possible.

If you are connected with Health Care,Insurance,Health Insurance industry then this book is a must for you.I forsee many things which had happened in USA will happen in India also over a period of time.

It is time for us to take corrective steps itself so that health care of poor people is not affected in the time to come .I know many poor people of Karol Bagh ,New Delhi who used to get treatment in Jessa Ram Hospital courtesy great Bhatia Family ,who were the trustees of this hospital.This hospital provided health care to Karol Bagh residents at practically no cost or fraction of the cost.Then this hospital became a part of leading hospital chain.Rates have gone up to market level.People remember Bhatia family.Hundreds of Bhatia's are needed to set up hospitals for those who are below the poverty line.

Regina has predicted that more and more US citizens will travel to India & Thailand for treatment.I wish beds are not made available to these foreigners at cost of Indian patients.It is time to add more and more hospitals ,medical collleges,nursing colleges in India.If the hospitality industry plans for hotel rooms and starts working towards the same we should also have a plan to add large number of hospital beds in next 5 years or 10 years.

West Bengal Govt is very liberal in attracting investment

West Bengal Govt is very liberal in attracting investment as they gave incentives to Tata Motors for Nano Project;
Land 645 acres or so for lease of Rs 1 crore /year
Electricity @ Rs 3 per kwh
Loan of Rs 200 crores @ interest rate of 1%

Now that Private sector is permitted to set up Medical Colleges can we expect the same benefit from West Bengal Govt .If yes they can attract 5 Medical Colleges in teh state and these can help the state with following;
More Doctors
Better health care
Medical Tourism
More jobs for people

Other states can also take the lead.Decision taken in 2008 will be appreciated by the masses when the fruits will be reaped.

Health Policies of Life insurance co's collectRs 100 crores

We have the first data available on the health insurance policies premium collected by Life insurance co's and this figure is Rs 100 crores.This figure is small but we know that these products were introduced by most of insurance co's during this year only.

We are familiar with inflation figure which is released by govenment agencies from time to time .First figure which has become available for inflation in health care is 17%.This means that if you wish to maintain the coverage of your health care then at the time of policy renewal you should increase it by 20%.That makes sense.

In the event of no claim being made during the year the cumulative bonus of 5% increase being given by your insurance co is not at all sufficient.Choice is yours.

Wednesday, September 10, 2008

TPA's to expand in Tier 2 cities

According to a report of Financial Chronicle September 08, 2008 TPA's will be growing in Tier 2cities as more and more people are being insured in these cities.Till recently were having on an average service network of about 10-15 branches in the country, most of which being in state capitals. In contrast, the general insurance companies, which control nearly the entire health insurance product portfolio, are present in an average of 400 locations. This huge disparity requires TPAs to aggressively expand their operations to meet the needs of the burgeoning health insurance market, industry experts believe. Besides, implementation of various government-sponsored health insurance schemes such as RSBY (Rashtriya Swashthya Bima Yojana) demands enhancement of service administration capabilities from TPAs. One of the larger TPA players, MediAssist, is planning a major expansion in tier-ii cities, both in terms of number of centres and employees, and is also looking to service various government-sponsored health insurance schemes.Let us hope that expansion does not result in deterioration of the service level.
Labels: Service level, TPA's to expand in Tier 2 cities

One should not try to be smart with Insurance company...

One should not try to smart with Insurance company One should not try to smart with an Insurance company Ekta Elreja has come out with an interesting investigating story in 'Metro Now'' about how a smart person has been trying to cheat Insurance company with false claims.The story in brief is ;For those of us blessed with perfect health, taking out a health insurance policy seems like giving away money. Akash Sharma is one man who decided that it was time to make the insurance companies pay. Using different names, he swindled the ICICI Lombard General Insurance Company to the tune of several lakhs of rupees before being found out and arrested.But the icing on the cake of this fraud was that not only did he take out policies under different names, he also created a fictitious hospital to manufacture the papers required for a mediclaim. Imagine the shock of the vigilance official from ICICI Lombard who went to track down a Sympathy Hospital in Indira Puram in Ghaziabad (UP) only to find a three-storey house in its place.Akash’s scam was almost perfect. He had it all planned down to the last letterhead for 'Sympathy Hospital’ and the ‘pathology reports’ to buttress his claims. What he failed to account for was the vigilance checks carried out by the insurance company.“Initially we never suspected anything because the amount in the claims was always under Rs 50000. Had he made a big claim, he would have been put through greater checks and would have been required to submit more document. Between January and June of this spokesperson for ICICI Lombard General Insurance said.”Moral of the story is " Do not try to be samrt .You will be caught.Labels: Akash Sharma is caught, Metro Now, Sympathy Hospital
Labels: Akash Sharma is caught, Metro Now, Sympathy Hospital

Tuesday, September 9, 2008

Bench Marking is done for Cataract & Asthma by FICCI

Insurance companies have been worried about the payment they are making to the hospitals for treatment of insured clients.It is a common statement in India that moment hospital comes to know the patient is insured their billing meter starts moving at a higher rate.This point has attracted the attention of FICCI and they have been working on it.

Teena Jain has covered this in an interseting manner in Mint, published from New Delhi.

As health insurers struggle with issues related to inflated billing, the insurance and health committees of industry lobby Federation of Indian Chambers of Commerce and Industry (Ficci) are developing yardsticks to establish minimum standards of treatment and costs for some diseases.
These standards are expected to give some indicative lines to insurers for settling bills with hospitals. The committee has completed its benchmarking for cataract and asthma.
“Once guidelines are developed for all the diseases, it will help insurance companies in pricing their products, settlement of claim disputes and in packaging new kinds of products,” said Jyoti Viz, director of financial sector at FICCI.
When all the standards are available, the Insurance Regulatory and Development Authority will decide whether they should be made mandatory or left to the discretion of the companies, Viz added.
For the last six months, the committee has been developing these standards along with the regulator and the General Insurance Council, or GIC, an umbrella body of general insurers.
A senior official at a public general insurance company said some sort of arrangement with hospitals would be required to control costs through such protocols.
“The benchmarking can be successful only when underwriters commit that they will patronize only hospitals which accept these benchmarks for billing purposes. Apart from this, volumes generated by insurers from health insurance business need to increase manifold,” said Niraj Kumar, general manager of The Oriental Insurance Co. Ltd. “No standard has come to us so far.”
Cases against insurance companies, especially involving the health insurance segment, account for the highest number of cases in consumer courts.
After standards are available, FICCI will run them through medical associations to ensure their accuracy.

My comments on Shobhana Chadha news in Economic Times Sep 7,2008

Shobhana Chadha, has covered an interesting story in September 7, 2008 issue of
The Economic Times on HEALTH INSURANCE

Never let bad choices spoil your future. You surely cannot correct your past mistakes, but definitely secure future by taking right decisions now. Take, for instance, Ramakrishna Pandya who learned from a stumble. The 50-year-old PSU employee, despite covered under a health plan, had to shell out a hefty sum of Rs 2 lakh while undergoing treatment for a bypass surgery in a private hospital.

Pandya’s fault was that he had picked up a health insurance plan which had sub-limits imposed on room rent, doctors’ fee and diagnostics. He could have easily saved himself from such a huge financial loss if he would have opted for a right health insurance policy, which fulfilled his requirements. To make sure that you don’t suffer due to an inadequate cover, here’s an insight into how to select the right medical insurance.

How to choose

First and foremost, insurance experts advise you should make sure that the health policy you opt for provides the right kind of coverage, which is in line with your family history of ailments and professional hazards. It’s a daunting task, keeping in mind that there are a host of health insurance products available in the market that differs widely in coverage and cost.

Says Sanjay Datta, head, health and accident insurance services, ICICI Lombard: “Contact insurance companies call centre or ask your agent to show you policies from several insurers so that you can compare them. Make sure the policy protects you from large medical costs, and beware of single disease insurance policies.” According to Datta, there are some polices that offer protection for only one disease, such as cancer. Thus, if you already have health insurance, your regular plan probably already provides all the coverage you need. Do check for the coverage you have before buying any more insurance.

Must haves

The basic purpose of health insurance, according to health insurers, is to protect you against health problems that impact you financially. “Therefore, your plan must insure you for three major categories — critical illness, hospitalization and surgeries,” says Sitesh Prasad, vice-president, Tata AIG General Insurance. Another thing, points out insurance experts, you should look before buying a health plan is cashless facility, which gives you the freedom of not making any advance cash deposits in case of hospitalization.

Datta believes the cashless facility serves as a boon for those times when you need finance the most. You have to simply use your health ID card at any of insurance providers’ network hospitals to avail of cashless service. “It is important for you to know that all insurance companies do not provide this facility,” says Datta. According to insurance experts, an Rs 1 lakh plan for a 30-year-old that provides coverage for all the three categories (mentioned above) should result in premium of not more than Rs 3,000-5,000 a year.

Scan the riders

For starters, you must remember that not every disease comes under the purview of a health insurance plan. Generally, a health insurance plan covers major diseases or illnesses such as cancer, bypass surgery, myocardial infarction, kidney failure, paralysis and so on. But with a rider — they do not protect from illness/ injury existing before the inception of the policy for the first four years.

Other cases when you can not count on your health insurance are — allopathic treatment, pregnancy and childbirth-related diseases, cosmetic aesthetic and obesity related treatment; expenses arising from HIV or AIDS related diseases, use or misuse of liquor, intoxicating substances or drugs as well as intentional self-injury; any medical expenses incurred during the first 30 days of inception of the policy, except accidents; congenital diseases; war, riot and strike-induced hospitalization.

Further, you should review the room and boarding cost thoroughly before you opt for a plan. Most of the insurance policies cap room and boarding costs at 1% of sum insured a day and at 2% a day for those in an intensive care unit. Thus, when you sign up on the dotted lines, do check if the insurer has assigned a substantial sum for these expenses.

There’s also a chance that your company is providing a health cover under a group plan. Group health insurance is a benefit that companies, private bodies and trusts provide to their employees or a homogeneous group of people and enables them to receive private medical treatment quickly and at low cost. However, what you must make sure is that you are adequately covered under a group plan. If you are not, then you should buy a health policy immediately. Remember, penny wise, pound wise!

Some of the points where I find contradictions are;

Pandya Case: If he is working for a PSU the he is covered under Medical Rules of the company, which are very liberal. Full costs are borne by companies like Indian Oil or NHPC .Even Helicopter evacuation of the employees is covered by NHPC ,if employee
is to be evacuated from a remote dam site to a metro for treatment. Even the best health Insurance policy does not cover Helicopter evacuation .If Pandya had to pay Rs 2 lakhs then it is not because of sub limits but may be because of under insurance i.e. he was not covered for sufficient amount.

Sanjay Dutta suggests contacting Company call centre or agent: If you contact company’s
Call centre they are ready to give their rates /policy details. They do not have competitors data or they don’t want to reveal it. This means that you do not get choice. Same way agent also is handling only 1 company and does not give comparative quote. It is always better to go to site like or consult an Insurance brokerage firm which is handling products of all insurance companies.
Sanjay mentions Rs 3000 to Rs 5000 for a person 30 years old for sum assured of Rs 1 lakh.This is possible for Rs 1400 or even less in case of Reliance General.

Allopathic Treatment: there is no policy which does not permit Allopathic Treatment.
In fact treatments which are not covered are Homeopathy, Naturopathy, and Magneto therapy.
Treatment by Magneto therapy has been accepted in USA. Homeopathy is widely practiced in Germany .We even have Homeopathy colleges and hospitals in India then why we are not covering it under Health Insurance Policy. Is it that we under pressure of
Allopathic lobby? Let us see who makes the beginning.

Wednesday, July 16, 2008

We welcome BUPA decision to enter India

We are pleased to know that MAX has joined hands with BUPA and JV will be taking shape in the coming months.

We are hopeful that with BUPA entry we will be moving away from an era of traditional health insurance products to innovative products offering premium features, ofcourse with corresponding price increase.

International automobile companies are selling premium automobiles to the Indian customers/HNI customers with price ranging from Rs. 20 Lakhs to Rs. 550 Lakhs (insurance premium varying from Rs. 60000 to Rs. 15 Lakhs)

Is it not surprising that we have been selling Health Insurance Policy with sum assured of Rs. 5 Lakhs (rarely Rs. 10 Lakhs) and premium in the range of Rs. 10000 to Rs 15000

The person has his car insured for accidental repairs of Rs. 20 Lakhs or Rs. 80 Lakhs or even Rs. 200 Lakhs but he himself can go in for hospitalization of Rs. 5 Lakhs only.

In one of our blog we wrote that helicopter evacuation is not allowed as a payable expense in the policies being issued. Grand sum of Rs. 1000 is available for ambulance charges.Let us change with time.

Let us hope BUPA and some new entrants will change the rules of the game,

Friday, July 11, 2008

Health Insurance is the fastest growing segment of non life/general/health insurance industry of India

In 2005 when we brought out ''Best Guide to Buy Health Insurance'' in the form of book we had predicted that Health Insurance will emerge as an important segment of Indian non life insurance industry.

Even though we never thought that due to detariff the rates for Fire Insurance will go down by 85 to 90%-but we are pleased to note that during 2007 -2008 health insurance premium has grown from Rs 3300 crores to 5000 crores and with growth rate of 50% ,it has emerged as the fastest growing segment of Indian non life insurance industry.

We do hope this segment will now attarct the attention of top management and they will look into various aspects with a view to improve customer satisfaction.

Tuesday, June 24, 2008

Money Today June 26 issue has covered health Insurance

22 pages of well researched information in Money Today is welcomed by us as this shows that Health Insurance is getting the importance ,which it deserves.

The good thing is that we have got lot of response thro emails/phone calls and some of the readers of Money Today have raised very interesting and good questions.

We will like to share with Insurance companies that the most important feature the customers are looking for in Health Insurance is good Service.Price is important feature but it is definitely not the first point at time of decision making.

Friday, June 20, 2008

Large & strong companies should give 90 days notice and then withdraw any product

Recently we were informed by Reliance General that no more Health Insurance proposal under Gold should be accepted.Reason we are made to understand is that they are having heavy losses in this product.

In the case of silver those wishing to have sum assured of Rs 1 lakh will not be accepted by underwriting team.

Those lodging claim during the year whether claim is accepted or not will have difficulty at the time of renewal.They are warned that well in time thay should look for another insurance company.

Insurance intermediaries go on informing clients about various insurance products to clients.It becomes embarrassing to tell a client that now Reliance or such & such Insurance company has stopped accepting this proposal or has withdrawn this product or is not going to renew your policy as you had lodged a claim during the year.

Let us try to create a positive image of Insurance Industry,which is owned by really large & strong companies or corporate houses of the country.Can we expect that whenever they decide to stop any product they should give at least 90 days notice by releasing an ad in the press ?

Comments are invited.

Friday, May 16, 2008

Should premium be calculated on completed age or running age?

Should premium be calculated on completed age or running age basis?

Most of the Insurance Companies take completed age in calculating premium.

On Aug 16, 2007 New India Assurance Company Ltd. had switched over from completed age to running age concept.

At present this type of information is not advertised in the form of a statutory ad therefore no one comes to know about this.

Mr. B K Shah, a medical practitioner for Mumbai realized the difference due to change over at the time of renewal of his policy and took up matter with New India.

Rucha has written a nice news story on this in Times Business of May 16 and it is as follows;

Insurance firms calculate running age for premium

Senior citizens, who are already grappling with steep premium rate hikes, have yet another reason to be miffed with the controversial health insurance sector. In what could perhaps be a first instance of its kind, last year, a public sector insurer started calculating and charging premium on the basis of an insurance applicant’s running age, against the normal practice of completed age.

Mumbai’s B K Shah, himself a medical practitioner, discovered this when he applied for his Mediclaim policy renewal. “In a nutshell,” says Shah, “When I went for renewal at the New India Assurance Company in October, the policy showed up my age as 74, although it should have been 73....I was told that they had introduced a ‘running age’ concept.” Shah says he thus had to shell out a higher loading (increase) on the premium than if his actual age were taken into account. He paid Rs. 700 extra. “With this additional amount, my renewal premium rose to a total of Rs. 23,052 last year from Rs. 11,053 in 2006.” Subsequently, Shah made a right to information (RTI) application, which confirmed the company had shifted to this structure since August 16, 2007, “as a corporate decision”. Bimalendu Chakrabarti, CMD at New India Assurance, corroborates this development. The RTI document assured that as and when the policy was due for renewal, policyholders would be intimated along with premium calculation. Shah denies receiving any such intimation. The document also mentioned that “the product” was approved by the sectoral watchdog – Insurance Regulatory Development Authority of India (Irda). Shah now approached the Irda to verify the claim. “I received a ridiculous reply that the method of calculating age is an internal underwriting issue to be decided by the concerned insurer.” In the absence of Irda chairman C S Rao, who retired earlier this week, a detailed discussion on the subject was not possible. However, an Irda official admits that the regulator has not issued specific instructions in this regard. “Most companies follow (the concept of) completed age and one follows running age…Companies’ policies are disclosed in their documents.”
Another official adds, “In a detariffed market, the premium has to be decided by the insurance company.”
The ombudsman’s office too washes its hands of the issue. “This is not an area of dispute. We don’t look at issues such as age. We come into the picture only when a claim is denied.” says an official. Blaming this laxity for the situation, K S (Kaka) Samant, general secretary at the General Insurance Pensioners’ Association, Western Zone, says: “Since the Irda has not taken any objection, it is taken as a sign of approval.” The consumer organizations TOI spoke to said this was a case of commercial considerations overriding logic. As Mumbai activist Jehangir Gai asks, “Would someone who is 17 and running 18 be allowed to vote?”
Shah also made RTI requests to other public sector general insurers – Oriental Insurance Company, United India Insurance Company and National Insurance Company. They charge premium according to the applicant’s actual age.

Our comments:

1. If all the Insurance Companies are following one definition/norm then why did New India decide to go it for new definition?

2. Should Insurance companies advertise in the form of a statutory ad so that customers as well as insurance intermediaries are made aware of this type of change?

Your feedback will be appreciated.

Thursday, May 15, 2008

Punjab, Uttrakhand and Bihar also to cover health insurance of poor families

It is nice to know that more and more poor families are being covered under health insurance policies being issued by state governments and Insuarnce co's.

The contracts have recently been awarded by these states;

Punjab - New India Assurance co. Ltd.
Uttrakhand - United India Insurance Co. Ltd
Bihar - Oriental India Insurance Co. Ltd

The states which have already implemented this policy are Rajasthan, Haryana and Delhi. According to our information these states and concerned insurance co’s have started distribution of smart cards.

Bids are expected from the following states in the coming month or so;
Tamil Nadu
Uttar Pradesh
West Bengal

The states where Indian Government is giving 90% subsidy are;

All North Eastern states
Jammu & Kashmir.

Mr. Anil Swarup, director general of labour welfare in the ministry of labour and the official in charge of implementing the scheme, said: “We are still in talks with Andhra & Madhya Pradesh governments, who have not taken steps for implementation of this scheme. We understand there are issues over committing 25% towards the premium. Andhra Pradesh already has a health insurance scheme. These states will not be covered in the first year.”

Tuesday, May 6, 2008

Contradiction between definition of a family

The Sixth Central Pay Commission (CPC) in its report has said, “Presently, the definition of family for the purposes of LTC includes parents and/or stepmother residing with and wholly dependent on the Government employee. Stepfathers residing with and wholly dependent on the Government employee are denied the benefit available to similarly placed stepmothers. The definition also places an unreasonable restriction in such of those cases where parents, despite not having any source of income and being totally dependent on the Government employees, continue to live in the native place. The parent in such cases are denied the option to travel to the place of posting of the Government official under LTC. The Commission, therefore, recommends that parents and/ or step parents (stepmother and stepfather) who are wholly dependent on the Government employee shall be included in the definition of family for the purpose of LTC irrespective of whether they are residing with the Government employee or not”.
The Sixth CPC has further said, “The definition of dependency is being linked to the minimum family pension for all purposes. Accordingly, all parents and/or step parents whose total income from all sources is less than the minimum family pension prescribed in Central Government and dearness relief thereon would be included in the definition of family for this purpose. The extant conditions in respect of other relations included in the family including married / divorced / abandoned / separated / widowed daughters shall continue without any change”.

Indian insurance industry is not ready to consider many of these relatives as the member of a family when it comes to issue the health insurance .We have instance where a mother wanted to take a policy for unmarried daughter of 27 yrs but the policy was refused as she is over 21 yrs.

It is in the interest of Insurance co’s to broadbase the definition of a family so that no of insured is increased , no of policies to be issued is reduced. This is the only way to be cost effective in handling the business.

Are Indian Pvt health Insurers blocking payouts ?

The Economic Times of May 6,2008 has carried part of the report released by USAID .The contents are ;

INDIAN health insurance is growing by 25% every year, it’s penetration is less than 0.02% of the GDP, yet there is no expertise on the sector, says USAID report.
The report, released on Monday, to study the impact of private life insurance on health coverage in India has said that the focus in India is on controlling claims pay-out by following strategies designed to minimise insured person’s ability to collect claims. “There is excessive emphasis on disqualification because of pre-existing conditions and post-claim underwriting”, it said. No wonder then, that it is one of the largest litigation areas for insurers. The report has suggested a slew of measures to improve the regulatory framework for health insurance.
For the regulator, Insurance Regulatory and Development Authority (IRDA), the report has a separate prescription for health insurance. Separate reserving rules should be considered for the different categories of health insurance, taking into account the short-term versus long-term nature of contracts, whether policies provide indemnity or assured benefits and the loss experience of varying health insurance products.
It has also asked IRDA to promulgate specific regulations for the sector. These include a minimum regulatory definition of pre-existing illness or condition to provide clarity in interpretation spelling out maximum “look-back” and “look-forward” periods. Further regulation is need to prohibit post-claims underwriting, making it mandatory for insurers to offer both group and individual policies among others.
Taking into account medical inflation, the report called for higher public health care spending. Effective primary care and prevention, safe maternity care and chronic disease management should be a part of public and private insurance, it said. “The burden of disease as measured by Disability Adjusted Life-Years could be reduced significantly if both health insurance coverage and publicly provided care included these services,” it said.
The country has a dismal record of even hospitalisation coverage – the basis for health insurance, it said. Quoting a recent census, it said only 1.7% of admissions were reimbursed and the average reimbursement was only Rs 258 (or 3.6% of the average hospitalisation cost of Rs 6,225).
Private insurers’ administrative cost are 40% of total premiums, double the target benchmark of 20%. Policy holders pay higher charges for healthcare services than those without insurance, because the mediclaim product has been modified in ways that make it less a program to control the cost of care and more a reimbursement target for providers.
The report forsees a more dynamic TPA market going forward, where TPAs could partner with insurer organizations. To encourage competition, it is recommended that mutual insurance companies and non-profit companies should be allowed to enter the market. Although IRDA can retain licensing TPAs, parts of regulation of TPAs should gradually come under the contractual relationships that insurers have with TPAs.

Our comments are;
We as an industry lack innovativeness.When an insurance co wants to develop a product they simply see the products of other co’s and try to copy the same.We suggest they should look at products from around the world and then come out with product.

Thursday, May 1, 2008

Reliance stops health gold policy

Reliance has stopped issue of Health Gold Policy.They will continue to issue standard & silver policy.

The salient features of Gold were;

1Higher sum assured

2 Critical illlness also covered

We feel that this was a good policy but one can assume that this was not a profitable product and that is why it became necessary for them to withdraw this product.

A quetion before we the consumers is '' Should it be made mandatory for Insurance co's to release an ad informing the fact that they are withdrawing a specific product?''

Your comments are invited.

Tuesday, March 25, 2008

New India starts sale in health insurance by offering 5% to 10% discount

Various Insurance companies increased the premium by following each other.There has been heartburn and criticism in blogs,press & electronic media.Even IRDA had to issue the instructions in this regard.

It is nice to know that New India has announced the following discount structure for those going in for renewal of the policy without making any claim in the current year.

Mumbai 10%
Delhi/Bangalore 7.5%
Rest of India 5%

We feel there is scope in management of the hospital expenses,negotiating for rates for surgeries,going in for special rates for the rooms/icu's. Let GIC(General Insurance Council) play a leading role in bringing down the hospital expenses and pass on the benefit to clients/customers.

Let IIM or ISB be given the assignment to undertake the study /research paper on the profitability of the hospitals/ loss of Insurance co's so that corrective steps can be initiated.

New India starts sale in health insurance by offering 5% to 10%discount

Wednesday, March 19, 2008

IRDA ASKS PSUS NOT TO FORCE ELDERS TO SWITCH TO NEW HEALTH PLANS Mumbai, March 17, 2008The Economic Times (Delhi edition) The Times of India (Delhi edition)
Insurance regulator Insurance Regulatory and Development Authority (IRDA) has asked state-owned insurance companies not to force senior citizens to switch to a new health insurance plan with lower benefits at the time of renewal of policies. The regulator has reiterated that insurers cannot raise rates on mediclaim policies by more than 50-75% of the previous year’s premium, following an adverse claims experience. With complaints pouring in from senior citizens, the regulator has set up a special cell to look into their complaints. The regulator has appointed R Srinivasan as officer on special duty, in charge of the cell based at IRDA’s Hyderabad office. Senior citizens who have problems with their mediclaim renewal can contact this special cell. The IRDA panel on health insurance issues faced by senior citizens mooted the idea. Senior citizens’ association has been clamouring for a special cell, given that health insurance accounts for over 15% of non-life premium. The IRDA panel had also recommended a health insurance pool under the aegis of IRDA to take over high risks cases, including the ones whose renewal premium is hiked by over 40%. A similar pool exists for motor third-party liability insurance. IRDA is yet to take a view on the pool for rejected health insurance covers. Incidentally, the regulator had put a similar cap on rates for third-party liability insurance a couple of years ago, even after it was decided to increase rates by over 100%. In a circular to public sector insurance companies, the regulator said that PSUs have already revised the premium rates in respect of mediclaim policies in April 2007. “The authority received several complaints from senior citizens that renewal premiums charged to them were exorbitant. The authority, therefore, advised all the public sector general insurance companies that: The loading of premiums if justified for renewals of mediclaim policies issued to senior citizens shall not exceed 50-75% of the premiums charged prior to the revision.” IRDA has also said, “Senior citizens shall not be compelled by the insurance companies to migrate to other health insurance products, if it is to the disadvantage of senior citizens. The above instructions are applicable to renewal cases only. The authority has now created a separate cell to attend to the grievances of senior citizens in respect of non-renewals or exorbitant increases in premium of mediclaim policies of public sector general insurance companies,” the circular said.

Thursday, March 13, 2008

IRDA tells Insurance co's to not to overcharge elders for health insurance

The Business Standard has covered an interesting news item regarding over charging of senior citizens for Health Insurance by the Insurance companies.
We find the heading of the newsitem
''Don’t overcharge senior citizens, Irda tells insurers '' very bold and interesting.
The insurance Regulatory and Development Authority (Irda) has warned all public sector general insurance companies to not to charge higher premium from senior citizens on medical insurance policies or mediclaim. According to industry sources, a leading public sector general insurance company is charging senior citizens almost Rs 1,000 extra in premium. For example, for a sum assured of Rs 1 lakh, the company is charging Rs 2,700 in premium compared to Rs 1,500 before the revision. It may be recalled that all public sector general insurance companies had revised mediclaim premium n April 2007.
Irda further added. “The Authority has received several complaints from senior citizens that renewal premiums are exorbitant. Senior citizens should not be compelled by insurance companies to migrate to other health insurance products if it is to the disadvantage of senior citizens.”
The regulator has asked all chairmen of public sector insurance companies not to exceed 50 – 75 percent of premium charged prior to the revision. Meanwhile, the regulator has created a separate cell to attend to grievances of senior citizens in respect of non-renewals or exorbitant increases in premium payments on mediclaim policies by public sector general insurance companies.

Those of you who want to send complaints can send these to ;

The Grievances Cell
Senior Citizens Health Insurance
3 rd Floor
Parishrama Bhavan
Basheer Bagh
Hyderabad – 500004
Attn. Shri R Srinivasan,Officer on Special Duty

Incidentally people are curious to know how many policies have been issued to senior citizens?

An effort by Mint to get this info resulted in total silence from all insurance co's and no one revealed any figure.

We estimate it is less than 2000 on all india basis.


According to The Tribune
The Delhi Cabinet has also decided to launch “Rashtriya Swasthya Bima Yojna” (RSBY) next month. The decision was taken today in a cabinet meeting presided over by Chief Minister Sheila Dikshit. While briefing media after the meeting, Dikshit stated that the RSBY would soon be launched in Delhi with an aim to provide health cover to around 4.40 lakh workers who have been issued BPL ration cards in Delhi. Most of these persons have been working in the unorganised sectors. It is meant for providing quality health cover to the workers and their families who possess BPL ration cards. She added that the RSBY would be launched next month in a function. The scheme would be implemented in association with Oriental Insurance Company Limited which would bear the cost of medical treatment up to Rs 30,000 a year per family. The beneficiaries of the scheme would be issued a smart card that will permit cashless medical transaction. The cost of issuing of the smart card would also not be charged from the beneficiary. Every person seeking insurance cover would have to get registered.

We welcome the step of Delhi Govt.

Are IRDA panel’s recommendations for securing health cover for senior citizens being swept under the carpet?

The Economic Times has covered a news item giving impression that
IRDA panel’s recommendations for securing health cover for senior citizens being swept under the carpet? The report was submitted almost three months ago and senior citizens want it to be implemented. But the Budget has remained silent on the recommendations while IRDA has merely forwarded the report to the General Insurance Council.
To make things worse for elders, insurance companies are now denying that there is any order from the regulator to cap mediclaim rate hikes at 75 percent.

Health Insurance Products from Max New York Life

All news papers have carried the news item that Max has entered health insurance field.
It has announced the launch of Lifeline series of insurance policies bringing long term insurance coverage for hospitalisation, surgeries and critical illness. According to Managing Director and Chief Executive Officer of Max New York Life Insurance, Gary Bennet, the policies have some significant “firsts” to its credit. Director, Marketing (Product Management and Corporate Affairs), Debashis Sarkar, said the policies come with fixed premiums for a five-year period, no claim discount on revised premiums, coverage for the largest range of ailments, free second opinion from the best in the country on diagnosis of illness and free telephonic medical helpline. The plan not only provided protection against medical expenses related to hospitalisation but also provided recuperation benefits.

It is nice to know that all PVt Life co's are finding this as a good market.
The qestion is are they followers - Do they treat LIC as their leader/

Buy TVS Auto rickshaw and get Health Insurance cover

The Hindu Business Line has carried the news item that those who will buy TVS auto rickshaw will get health insurance policy for sum assured of Rs 30,000
TVS Motor Company (TVSM) has formally launched its debutante autorickshaw TVS King, in LPG and petrol versions, marking its foray into the three-wheeler market. During the launch TVSM has also announced several welfare schemes for the autorickshaw drivers and their families, including a one-year free accident and healthcare policy. TVSM has tied up with few insurance companies for this and the policy would cover the owner and his family against medical care for up to Rs 30,000 per annum on a floater basis. The owner will additionally be covered by a personal accident policy for Rs 1 lakh.

We welcome this initiative of TVS .

ESIC is also covered under Consumers Protection Act

The first question arise after reading this news item is tht ESIC use the word Insurance then why it is not covered under IRDA.
DNA has covered a news item according to which
''Consumer courts have been given additional role by the government and the judiciary under the Consumer Protection Act (CPA), 1986. In a recent order of the Supreme Court of India, Employees State Insurance hospitals have also been included in the ambit of justice given by Consumer Courts. This was the order in the case of Kishore Lal vs chairman, Employees State Insurance Corporation (ESIC). Lal, a workman covered under ESIC, took his wife to an ESIC hospital for complications arising out of diabetes. She was admitted in hospital, but her condition deteriorated prompting Lal to transfer her to a private hospital. There it was known that both the diagnosis and treatment given to her was incorrect. Lal took his grievance to the district forum at Sonepat alleging deficiency of service. The forum held that the services rendered by the ESIC were gratuitous in nature and hence not covered under CPA and dismissed the case.

Kerala health insurance will cover those who are above the poverty line

The Hindu Business Line has carried news that Kerala will be the state which will offer health insurance even to those who are above the poverty line.
Is this that we have started diluting the scheme which has been developed by the Government of India for those who are coming under BPL.

The General Insurance Officers All India Association (GIOAIA), Kerala unit, has appealed to the government to implement the comprehensive health insurance scheme through one of the public sector general insurance companies only. Hailing the Kerala Budget proposal to introduce the scheme, which is based on the health insurance programme of the Union Government for below poverty line (BPL) families, P.P. Mohanan, Kerala State General Secretary of the association, said that the public sector general insurance companies had vast experience of 36 years in the field. Kerala scheme is open to persons outside the BPL category also, he said.

Let us have open field where PVt and PSU should compete.
Your comments are invited.


Kotak Mahindra Old Mutual Life Insurance Ltd, has also decided to launch a standalone health insurance scheme in the first half of the next fiscal. Till now, Kotak has been offering health schemes only as riders to its life insurance policies and this new scheme would be a standalone one, according to Arun Patil, company's senior vice- president for training and management. "This standalone scheme would cover as many diseases and eventualities as possible," he told reporters. Kotak would begin negotiations with hospitals for this scheme after this fiscal, he said, but declined to divulge further details. Let us see what can be the new benefits under the product of Kotak.

Wednesday, March 5, 2008

Will the floater health policies miss the tax benefits

The Economic Times has carried a news item according to which tax benefits may not be vaialble to those who are having family floater health policies.

According to Debjoy Sengupta
''Do you hold a floater mediclaim policy that covers you, your spouse, your kids and your parents? Well contrary to belief, you may not be able to claim the new benefit under Section 80D of the income tax that lets individuals covering parents to avail of an additional tax benefit — Rs 20,000 for parents who are senior citizens and Rs 15,000 for parents below 60 years. The FM in Budget 2008-09 has proposed an extra cut of Rs 15,000 under Section 80D to an individual who pays medical insurance premium for his/her parent or parents. What’s more, the fine print indicates if the parent happens to be a senior citizen, the tax sop is generous at Rs 20,000. But this may not apply in case of floater policies’ holders. For instance, insurers claim they “are not in a position to specify premium, which one pays for parents as the total sum assured is never separately defined.” “There is only an upper limit for reimbursement, which is the sum assured. This is where the grey area is!” said a source. A floater policy offers a certain sum assured for the entire family, a portion of which or the entire sum assured may be used by any one family member, including parents. Or may be shared by more than one. The insurer will pay at most the total sum assured for the entire family in a year, regardless of the number of members falling ill. “If an individual pays more than Rs 15,000 for a floater policy, the balance premium or even a portion of the remaining amount will not qualify for the new exemption for parents under Section 80D although he has covered the parents under the policy. This may act as a deterrent for buying floater policies for entire families and instead buy separate policies for parents. Premiums for floater policies are less than individual policies and offer flexibility when it comes to hospital bill reimbursements,” said an analyst.

We in www. feel that the Finance Ministry ,IRDA,Insurance companies shoul have an approach to simplify the procedures so that overheads are reduced and benfit goes to masses.
Options are;
1. There should be sum of Rs 35000 eligible under 80 D.No bifurcation should be there.Every additional polcy costs insurance company Rs 1000.Let us save it.
2.Co Payment clause under senior citizens policy is only applicable to senior citizens.Are we trying to please the senior citizens by giving by one hand and trying to take away the benefit by 2 hands. Let the insurance co's have uniform rules for all age groupes.


New India pays penalty for not renewing the health insurance policy

The Hindu ,has carried the following news item.

The Madras High Court has imposed a fine of Rs.10, 000 on New India Assurance Company for refusing to renew insurance policies of a septuagenarian couple because their son had shifted the policies of other, relatively young, family members and his employees to a private insurer. Dismissing a writ appeal filed by the company before the Madurai Bench, a Division Bench, comprising Justice A. Kulasekaran and Justice P. Murgesen, said such arbitrary denial would defeat the objective of medical claim insurance policies. On the appellant’s contention that nobody would take the “risk” of insuring aged persons in the wake of stiff competition between public sector and private insurance companies, the Judges said: “It is immaterial whether a government company is having monopoly or not, but arbitrariness should not appear in their actions and decisions.” Concurring with S. Srinivasa Raghavan, counsel for the insured, the Bench said the reason cited for not renewing the policy was invalid and contrary to basic principles of insurance law.

We in www. feel that New India ,the largest insurance company of our country should look at renewal of such policies with a liberal view and should get the goodwill of the masses.They release ads in print media and spend crores of Rupees but do not realize that one such judgement against them and being covered in a reputed paper The Hindu brings down the brand equity of New India.

Tuesday, March 4, 2008

Senior Citizens Health Insurance -should it come under pool

Senior Citizens Health Insurance -should it come under pool ?

This idea is being considered by IRDA as well as Insurance companies in the light of the fact that claims ratio is high.The same plea was used when third party insurance of vehicles was being considered.

The service level which the Indian Customer is getting with respect to third party insurance cover of 2 wheelers is well known.

Let us be prepared with same thing in the case of health insurance of senior citizens .With no insurance intermediaries in between we foresee less number of proposals being received by the companies ,hence issued.No one to push the proposals to be converted into policies.

Saturday, March 1, 2008

Rs 15000 paid for health insurance of your parents can get you rebate

The Finance Minister has announced additional limit of Rs 15000 provided you have paid the same for health insurance of your parents.

We welcome this.

When we come to practical aspects then the points arises are;

1.Insurance co wants parents to be the proposer under senior citizen policy and the proposal form should be filled up & signed by parents only.
2.The cheque should be issued by the parent.

While Income Tax deptt wants that premium should be paid by the income tax assesse only.

This means that parent will pay and get the rebate.

Let us see who changes the rules
Insurance company
Income Tax deptt.

Let us hope we do not have to wait for 12 months for change in rules.

Wednesday, February 27, 2008

Tamilnadu to introduce health insurance for below the poverty line people

According to Hindu Business Line,The Tamil Nadu Government has ordered that the National Health Insurance Scheme (Rashtria Swasthya Bima Yojana) for the unorganised sector workers belonging to the below poverty line (BPL) category and their families be taken up in Kancheepuram and Tirunelveli districts on a pilot basis. The Government has constituted a ‘Health Insurance Scheme Support Cell’ with the Commissioner of Labour as the Chairman. In a Government order issued on February 20, Ramesh Kumar Khanna, Secretary, Labour and Employment Department, said that the NHIS provided health insurance cover to the unorganised sector workers belonging to BPL category and their families (unit of five) for a total insured sum of Rs 30,000 per family per year on a family floater basis. All BPL families were to be covered in a phased manner under the scheme in the next five years commencing from 2008-09. While the Union Government would contribute 75 percent of the total premium of Rs 750 per family per year (i.e maximum Rs 565), the State should pay the balance cost of Rs 185.

Fromthis news item it is not claer how much will be the contribution of the person,who is being insured.

Reliance General will not be keen in renewing the health Insurance policy in the event of claim being more than 60% of the sum assured

Reliance General will not be keen in renewing the health Insurance policy in the event of claim amount being more than 60% of the sum assured.

It is suggested to existing policyholders( who have logged in claim of more than 60% of the sum assured during the year) to be ready for changing the policy from Reliance to some other Insurance Co.

Sunday, February 24, 2008

16 million workers under health insurance by Govt. of India

The Secretary ,Dept of Labour ,Government of India has announced that 16 million workers from the unorganized sector will be covered under health insurance during yr starting April1.2008.This figure will increase to 60 million in the coming years.

We should be pleased that health insurance is getting the importance which is needed.The cost is going to be Rs 30 per person.Persons will have the option to get the family members get covered.

In the advertisement of Ministry of Textiles we have come across the details of Rajiv Gandhi Shilpi Swasthya Bima Yojna with following details;

Medical Coverage Rs 15000,which includes OPD of Rs 7500 in a year.
Premium is Rs 800+Service Tax for the whole family.
Contribution by worker will be Rs 150 per year
Contribution by worker from SC/ST/Below the poverty line will be Rs 75 per year
Balance will be paid by The Government .
Policy will be issued by ICICI Lombard
Preexisting diseases are covered.
maternity is covered.
Cash less card will be issued.
Personal accident cover of Rs 1 lakh is part of the same policy.

If you know anyone who has this policy -we will like to know their experience .Do let us know.

Wednesday, February 20, 2008

IHI Denmark starts advertising its Health Policy in India

IHI Denmark has started releasing advertisements for its Health Policy in India.Should we assume that international companies have realized the potential which India offers?

Indian Lock manufacurers did not realize the threat of Chinese locks and lost the market to Chinese imports.

Under Govt of India rules Indians are permitted to spend money in Foreign exchange.While Indian Insurance companies take rigid stand on issuing the policies will we lose the business to International co's like IHI.

Time will tell.

Tuesday, February 19, 2008

IHI Denmark starts advertising in India

IHI Denmark starts advertising in India-does it mean that they have realized the importance and potential of Health Insurance market in India.

All are aware of that under liberal rules with respect to foreign exchange in India any one can send the payment out of India and some people will like to have health insurance policy from a foreign company.

Indian insurance companies should not take it lightly.They will have to face global competititon.

Monday, February 18, 2008


LIC enters Health Insurance with Health Plus

LIC has entered Health Insurance segment with Health Plus policy.
Positive points are;
Long term 20 Years
Benefit of Unit linked growth
Payment of following;
Hospital cash benefit
Major Surgical benefit
Domicillary Treatment benefit
Limits for HCB are;
year 1 -18 days
Yr 2 -60 days
Yr 3 -365 days.

Suppose amount chosen is 1000 Rs /day
child 1
child 2
Total amount paid is Rs 15000 then Rs 9000 will be used for buying of units and balance is towards health part.

DTB starts after 3 yrs .i.e in 4 th Yr.
Amount paid is Rs 2 lakhs and till Yr 20 it can be paid 3 times therfore person gets Rs 6 lakhs and every member gets Rs 6 lkahs.
In total it can be Rs 6 lakhsx4 i.e. Rs 24 lakhs.
After study will come with moredetails.

Monday, January 14, 2008

Need to abolish service tax on health insurance in India

The budget exercise of Indian Government for the year 2008-09 is on and indications are that service tax on health insurance will be abolished.

Seeing the importance of health insurance and very low penetration in India it is worthwhile for the Finance Ministry to abolish this tax on all policies whether individual,family or group. This should be done for next 10 years.

Healthy people build strong nation and this can be the support from the government towards achieving the objective.

Thursday, January 3, 2008

Health Insurance Rates to go up in 2008

After reading the news item that effective Jan.1,2008 premium rates for Fire + all risks will go down further ,we have been approached by many customers located all over the country that what reduction they can expect in the premium rates for health insurance.

It is true that rates for Fire + all risks policy for low risk clients will go down but we foresee that rate for health insurance will get strengthened or we can say go up only .Reliance General Insurance had increased the rates in Dec. 2007 itself .Other Insurance co’s will have the tendency to increase the rates as and when it is possible for them. Co pay will be used as another alternative to not to increase the rates. But ultimately the client will pay for the same at the time of lodging of the claims.

Our suggestion to those who are considering buying health insurance in near future is not to wait for long but go in for issue of the policy at the earliest as the premium rates will go up.

Wednesday, January 2, 2008

Health Insurance Premium to go up during 2008

Many readers have read the news that with effect from Jan,1 2008 rates for Fire+all risks policy have gone down.They wish to know how much is the reduction in health insurance premium rates.

Well ther is no reduction in the rates-infact you should expect the rates to go up.During Dec ,2007 relaince general Insurance has increased the rates for health insurance