Analysis of Health Insurance Premium of Different Insurance Companies of India during 2012-13

Data of Health Insurance Premium for different Insurance Companies of India for year 2012 -13 is now available and the total figure has reached Rs.15341 crores for the year ended March 31, 2013.

S. No.	Insurer	Premium	% Share
1	Apollo Munich	598.75	3.90
2	Bajaj Allianz	594.85	3.88
3	Bharti AXA	195.49	1.27
4	Cholamandalam	287	1.87
5	Future Generali	139.13	0.91
6	HDFC ERGO	521.50	3.40
7	ICICI Lombard	1665.17	10.85
8	IFFICO TOKIO	210.79	1.37
9	L&T	26.37	0.17
10	Magma HDI	0.00	0.00
11	Max Bupa	206.42	1.35
12	National	2372.22	15.46
13	New India	2757.71	17.98
14	Oriental	1491.94	9.73
15	Raheja QBE	0.02	0.00
16	Reliance	295.53	1.93
17	Religare Health	38.39	0.25
18	Royal Sundaram	209.23	1.36
19	SBI	6.74	0.04
20	Shriram	0.00	0.00
21	Star Health	843.80	5.50
22	TATA-AIG	181.87	1.19
23	United India	2642.81	17.23
24	Universal Sompo	55.27	0.36
Grand Total		15341	100.00

Data Source IRDA

On analysis of the data we find that % share of PSU companies is 60.39%. It is higher than overall market share of PSU's in Indian Insurance Market. This means that Health Insurance premium is strengthening the premium figure of PSU’s.

	Rs. Crores	% Share
Public Sector	9264.68	60.39
Private Sector	6076.32	39.61
Grand Total	15341	100

Among the 5 top Insurance Companies we have 4 PSU's and 1 Private Company. ICICI Lombard is at 4th position where else Oriental is behind it at 5th position. These 5 Insurance Companies have captured 71.25% market share. 19 Insurance Companies share 28.75%. Out of there Magma HDI / Raheja QBE are yet to introduce their product.

Top 5 Insurance Companies are
Company	Rs. Crores	% Share of total Health Insurance market
New India	2757.71	17.98
United	2642.81	17.23
National	2372.22	15.46
ICICI Lombard	1665.17	10.85
Oriental	1491.94	9.73
Grand Total	10929.85	71.25

Reduction in premium of Star Health during the year is due to loss of Tamilnadu Government as client during the year. Star Health premium which was over Rs.1000 crores during last year has come down to Rs.843 crores and the benefit has gone to United India which was successful in capturing is business.

There are 18 companies out of 24 who are having market share of less than 5%.

What is the learning from this study?

Is it worthwhile for players having less than 2% share to be in this complicated / complex business of Health Insurance. There are 14 Insurance Companies in this category which means 59% insurance companies of India are in this category and are having market share of less than 2%.

Should these companies focus on other portfolio?  There are so many areas which are not being covered / insured. Health Care Equipment / Medical Equipment are one such area. Most of the companies have put this on decline list.

This is the world of specialization and market share. Let no one ignore it.

Indian Health Insurance Market- 2012-2013

Health Insurance Market continues to be loss making portfolio during 2012-2013

Estimates of Indian Health Insurance Market for the year ending March 31, 2013 are now available and according to it this market has touched figure of Rs.15341 Crores.

Overall loss during the year is Rs.1533 crores.

Corporate portfolio and Group Government portfolio (Schemes like RSBY,) continue to be a loss making portfolio. Retail portfolio continues to be the segment where insurance companies have been successful in reducing the claims figures by following rigid norms. May be the decision of PSU’s to go in for strictness i.e. July 1, 2010 and strengthening of PPN has resulted in good results.

Indications are that State Governments will not increase ( as it was happening 2 years back ) their budget for schemes / subsidy. As on now we are aware of that 4 PSU’s are increasing the premium in Retail segment by 30% (during 2^nd half of 2013). Will it result in increase in Revenue or it can result in some of the clients not renewing their policies.

Health Insurance Portfolio – An Analysis

Few years back we were very enthusiastic about the growth of Health Insurance portfolio. This was especially true during 2007-08, when this portfolio grew from Rs 3210 Cr to Rs 5110 Cr. i.e by 59.20%. Let us look at the growth figures from 2006 to 2013:

% Growth of Health Insurance over the Years

Year	Amount (Rs Crores)	% Growth
2006-2007	3210	14.45
2007-2008	5110	59.20
2008-2009	6634	29.82
2009-2010	8305	25.68
2010-2011	11480	38.22
2011-2012	13184	14.84
2012-2013	15341	16.36

We have drawn graph showing the % growth YOY and, it shows that figure is fluctuating and is becoming less and less attractive as the years have passed by.

Let us try to make projections for next 6 years.

We have done this with growth rate of 12%, 20%, 30% & 60%.

If we achieve figure of 30% then the portfolio will be Rs 56960 Cr. in 2017-2018.

If some one asks me- What should be the growth with which you I will be happy?- I will say it should not be 30% gross but it should be 30% net (as we have to discount for inflation of 10% per annum in normal costs and 20% per annum in health care costs). Let us not be satisfied with meager growth of 16%- let us aim for 60%.

It means we should have growth of 60% year over year and then the figure will reach Rs 160862 crores in 2017-18