A boon for health coverage after retirement

A boon for health coverage after retirement

Firm offers no-pain switch from company cover

Persons in the age group of 55+ are concerned about health insurance after their retirement, when they will no longer be covered under a company’s group mediclaim policy.

As the competition grows and more and more insurance companies come out with better products with better features- We have the solutions appearance on the horizon.

Apollo Munich has asked for approval from the Insurance Regulatory and Development Authority (IRDA) to launch Optima Vital, a ‘top-up product over corporate medical cover’, convertible to health cover after retirement. To be eligible, one needs to be already covered, as an employee, by an employer-firm and below 58 years of age; if so, the new product gives the option of taking an additional ‘top-up’ coverage to the former, and then, just before completing 58 years (even if the retirement is later), opting to change this into full individual coverage. Apollo would then do so without any extra fee or medical test.

We understand that other insurance companies are developing similar products. And are going to launch the same in near future. The move would help a large number of people who are often denied health cover once they cross 50 years of age. This is despite an Irda directive to insurance companies to increase entry age for cover to 65 years and not to refuse a policy on grounds of age or load senior citizens with extra premium.

Insurance companies are, however, not eager to do so; both fees and tests get stiffer with age, especially after 50 years of age. Usually, if someone wishes to buy health insurance in later life or after retirement, there is a waiting period, or the cover comes after various exclusions on “pre-existing diseases”.

“It is difficult for anyone to go ahead and buy a cover at the age of 58 years. If you buy a top-up cover while working, you will have the option to convert it into a full-fledged policy when you retire, “ said Apollo Munich’s managing director and CEO, Antony Jacob, on the proposed scheme. “It takes away the worry of the person while retiring.”

At present, apart from being reluctant to extend coverage for the elderly, many insurance companies do not even reimburse the cost of medical tests undergone during the process of checking or updating a cover.

Health Insurance industry estimates show –it has touched Rs 8100 Crores mark during this year (2009-2010)

Health Insurance industry estimates show –it has touched Rs 8100 Crores mark during this year (2009-2010)

Initial statistics for the year 2009-10 (year ending 31st March 2010) indicate that Health Insurance industry has touched figure of Rs 8100 crores. Last year this figure was Rs 6600 crores so it means that there has been growth or 23% during this year. Overall General Insurance Industry during 2009-10 has shown growth of 10% so it is heartening to note that Health portfolio has really contributed to the overall growth or General Insurance Industry.

Health Insurance Companies have also achieved high figures and Star Health and Allied Insurance Company Limited has reached figure of Rs 900 crores (exact figure awaited).This shows that standalone health insurance companies have strength to stand with health being the only portfolio.

On the profitability front the figures continue to be bad as this portfolio is still losing money and one should not be surprised that when all figures are complied then ( proper costing and allocation of overheads is done) then we find that in this portfolio there has been a loss of Rs 2000 crores.

Let us wait for the final figures as these are estimates.