Presentation By

Dr. Rajesh Kumar Attri, Deputy General Manager National Insurance Company Ltd. Pune Regional Office

4th May, 2012

HEALTH INSURANCE Financial security and protection to the insured

person in case of hospitalization and/or domiciliary hospitalization arising out of

1. Illnesses/Diseases

2. Accidents

TWO METHODS OF PAYMENT

1. Reimbursement

2. Cashless

PRINCIPLES OF INSURANCE Insurance is a mechanism where the losses of a few are

shared through contribution by many. It is based on the basic principles of insurance

1. Utmost Good Faith- Proposal form

2. Insurable Interest – The legal right to insure

3. Indemnity –Reimbursement subject to the limits agreed in the policy

Population Global population, 700 crs

India, 130 crs, 1.64% growth

17.5% of world population in India

2nd largest in world

China, largest, 19.4% of globe, , 0.53% growth

USA, 3rd, 4.5% of globe, 0.70% growth

Globe growth 1.30%

THE HEALTH PORTFOLIO General Insurance Industry Premium- Rs. 58325 crores

Health Premium Incl Social Sector- Rs. 13325 crores (22%)

Incurred Claims Ratio 101%

Loss Including Management Expenses 30%

POINTS TO PONDER Our Life Expectancy has risen from 36 years in 1951 to

67 years today.

Health Insurance is a necessity rather than an option

HEALTH PORTFOLIO IS THE FASTEST GROWING BUT LOSS MAKING PORTFOLIO

Health insurance schemes Voluntary health insurance schemes

Employer-based schemes

Insurance offered by NGOs

Community based health insurance (Self Help Groups, Bidi Workers, Mine Workers, Unorganized labor like Construction workers etc)

Government run schemes (ESIS, CGHS)

Health Insurance Companies

Spending India spends about 4.9% of GDP on Health Care

Insurance Central Government schemes

State government schemes

Insurance companies

Insurance Companies Life Insurance

Non-life insurance

LIST OF GENERAL INSURANCE COMPANIES Bajaj Allianz

Bharti AXA General Insurance

Cholamandalam MS

Future Generali India Insurance

HDFC ERGO General Insurance

ICICI Lombard

IFFCO Tokio

L & T General Insurance

LIST OF GENERAL INSURANCE COMPANIES (contd) National Insurance Co Ltd

New India Assurance Co Ltd

Oriental Insurance Co Ltd

Raheja QBE General Insurance

Reliance General Insurance

ECGC

Agricultural Insurance Co. Ltd.

LIST OF GENERAL INSURANCE COMPANIES (contd) Royal Sundaram

SBI General Insurance

Shriram General Insurance

Tata AIG General

United India Insurance Co Ltd

Universal Sompo General Insurance

Standalone health insurance Companies Apollo Munich Health Insurance

Max Bupa Health Insurance

Star Health Insurance

Religare Insurance Company

VARIETY OF COVERS IN GENERAL BRANCH Individual Health Policies

Group Health Policies

Family Floaters

Students Health covers

Senior Citizens covers

Overseas Health Covers

Critical Illness cover

Tailor Made Group Health Covers

Specially designed covers for Bank Tie Ups

Special policies for the social sector like UHIS, RSBY, RGJAY

INDIVIDUAL MEDICLAIM POLICY Individuals from the age of 18 till 59 can take this

cover.

Sum Insured ranges between 50000 to 5 lacs. Can be increased subsequently upto 10 lacs

Hospitalisation expenses arising due to disease and illness is covered.

Pre-existing diseases covered from the fifth year onwards after 4 claim free year.

GROUP MEDICLAIM POLICY Pre-Defined Groups/

Association/Institution/Corporate body like Employer Employee, subscribers to common facility like Account holders of banks, Credit Card holders etc.

Maternity Extension allowed with 10% loading in premium and benefits upto Rs. 50000/-

PARIVAR MEDICLAIM INSURANCE A Family Floater cover

Self, Spouse and 2 Children upto 25 years.

Age band 3 months to 60 years

One illness upto 50% of Sum Insured

SI from Rs. 2 lacs to Rs. 5 lacs. In multiples of Rs. 50000

VIDYARTHI MEDICLAIM FOR STUDENTS Age Group from 3 to 25 years.

Three Sections, Section I covers hospitalization of the student, Section II covers PA to Parents and Section III covers PA to the Student.

Sum Insured under Sec I ranges from Rs. 50000 to Rs. 2 lacs, Sec II will be twice Sec I and Sec III is restricted to Rs. 50000

VARISHTA MEDICLAIM FOR SENIOR CITIZENS Individuals above the age of 60 upto 80 years

Sum Insured of Rs. 1 lac for hospitalization and Rs. 2 lacs for Critical Illness or dreaded diseases cover. (Cancr, stroke, Multiple schlerosis,Coronary Artery Surgery, Renal failure, Major Organ Transplant and optional covers are Paralysis and blindness)

OVERSEAS HEALTH INSURANCE Specialy designed to protect persons travelling

overseas for business, holiday, studies or employment when sponsored or posted by Indian employer.

Emergency health expenses incurred to relieve immediate pain and to save life

Apart from illnesses and diseases, covers accident, loss of checked baggage, delay of checked baggage, loss of passport and personal liability during travelling abroad.

CIRITICAL ILLNESS INSURANCE Benefit policy targeting age group from 18 to 60 years.

Covers eight dreaded diseases (Cancer, Stroke, multiple sclerosis, major organ transplant, paralysis, blindness, renal failure and coronary artery surgery)

Person is given the sum insured in the event of inception or manifestation of the disease and survival of 30 days thereof. No claim is payable for the first 90 days.

SOCIAL SCHEMES UHIS: Sum insured of Rs. 30000/- per family with a

per sickness limit of Rs. 15000/- Premium is shared by the Central Government for persons below poverty line.

Rajiv Gandhi Jan Arogya Bima: Scheme introduced by Maharastra Government (Operated by National Insurance ) Sum Insured per family is Rs. 150000.

Rastriya Swasthya Bima Yojana

Some important features. Pre-existing exclusions.

Waiting period of 30 days

1st/2nd year exclusions.

Free Health check up after 4 continuous claim free years.

Cumulative Bonus

GLARING TRUTHS Health Premium grew from 774 crs (Out of 12100 crs

overall) in 2000 to 13325 crores (Out of 58325 crs overall ) in 2012

It was a meagre 6% of the GDPI in 2000 and has reached the figure of 23% of the GDPI in the year 2012. It will very soon cross the Motor portfolio, which is the major contributor to the GDPI

WHY IS THIS PORTFOLIO LOSS PRONE Improper Underwriting Management

Policies are not taken by persons who should. Proposers in higher age bracket and prone to sickness. Thus there is an adverse Selection against Insurers

Hospitals charges are not Regulated

Failure of rural schemes due to mismanagement; Benefits do not reach the target beneficiaries, due to many reasons ; eg lack of awareness, exorbitant medical expenses etc.

THE REMEDY: TOWARDS PROFESSIONAL UNDERWRITING

Have a more scientific method of rating proposals.

Lower the age, lesser the premium

Lower premium for non-smokers and non-drinkers

Lifestyle discount like Gym members etc.

Active grievance redressal system

THE REMEDY: TOWARDS PROFESSIONAL UNDERWRITING

Medical Underwriting, Recruitment of Medical Professionals to assist in underwriting

Targeting the young world Creating proper awareness, Product improvement and development etc. Redefining the need of health insurance, by inspiring the youth to take

covers. This can be achieved through Publicity in the print and visual media,

seminars and conferences, Interaction with the insuring public, the hospitals , the Third Party Administrators etc.

INSPIRING THE YOUTH TO EARN WHILE THEY EARN. Insurance Agency is the best method of earning while learning.

MAKING HEALTH INSURANCE VIABLE AND A WIN WIN SITUATION FOR BOTH THE INSURED AND THE INSURERS

OPPORTUNITIES/STRATEGIES MEDICAL PROFESSIONALS FOR UNDERWRITING

AND CLAIMS ASSISTANCE

INSURANCE AGENCY TO SELL HEALTH INSURANCE

PRODUCT DEVELOPMENT TO ENCOMPASS WORLDWIDE HEALTH COVER

Medical Tourism Indian medical tourism that was valued at US$350

million in 2006, is estimated to grow into a US$2 billion industry by 2012

Medical Tourism has a great potential for development of Health Insurance

Health cover should be considered for NRIs .

CONCLUSION Insurance Awareness and Feasibility should reach the

levels of Western Countries.

It is a long way to go but we shall achieve.