News . Views . Reviews

FDI in non-life insurance sector slips marginally to Rs 509 cr in FY20

Dec 1, 2020

Since the opening up of the insurance market in 2000, the non-life sector attracted a total FDI of Rs 4,721.68 crore as on March 2020. It was Rs 4,212.61 crore at the end of March 2019.

Foreign direct investment (FDI) in the general insurance sector slipped marginally to Rs 509.07 crore in FY 2019-20 from the previous year, latest data by the General Insurance Council (GIC) showed.

In FY2018-19, FDI in the non-life insurance space was recorded at Rs 516.61 crore.

Since the opening up of the insurance market in 2000, the non-life sector attracted a total FDI of Rs 4,721.68 crore as on March 2020. It was Rs 4,212.61 crore at the end of March 2019.

There are 33 general insurance players, including four public sector insurers, six standalone health insurers and two state-owned specialised companies — Export Credit Guarantee Corporation of India and Agriculture Insurance Company of India Limited (AIC).

It is to be noted that FDI limit in the insurance sector has been hiked to 49 per cent from earlier level of 26 per cent.

The insurance sector was opened for private players in August 2000 with the invitation for application for registrations. Foreign companies were allowed ownership of up to 26 per cent.

New India Assurance and GIC Re were listed on stock exchanges while ICICI Lombard from the private sector went public in 2017.

The sector has also seen consolidation in the last few years. The latest being the merger of Bharti AXA General with ICICI Lombard. The proposed deal got in-principle approval from the Insurance Regulatory and Development Authority of India (Irdai) last week.


New motor vehicle rules to come into effect from October 1

Oct 1, 2020

As per the official release of amendment notifications in the Central Motor Vehicle Rules 1989, the IT services and electronic monitoring will lead to improved implementation of traffic rules in the country. The notifications were released by the Union Ministry of Road Transport & Highways (MoRTH) on Saturday and they will be put to implementation on October 1, 2020 as a part of the Motor Vehicle Act.

The Motor Vehicle Act was implemented a year ago to revamp transportation rules in the country and to improve the steps of penalties such as traffic rule violations and technology up-gradation to curb corruption in the department.

Here are key things to know about the changes in motor vehicle rules:

As per the PTI, mobile phones can be used only for route navigation, in such a way that drivers don't lose their concentration while driving.

Vehicular documents that are validated electronically shall not be demanded in physical form anymore. Including cases in which the offense made out necessitating seizure of any such documents, the notification stated.

The details of license disqualification shall be updated chronologically on the portal. The record shall be updated on the portal regularly.

Not only would driver records be maintained electronically, but their behavior would be thoroughly monitored as well.

The records on the portal would be updated every time they are inspected. The identity of the police officer or any other stakeholder would be noted on the official portal. Drivers are permitted to maintain their vehicular documents on the central governments' online portal like Digilocker or m-parivahan.

As per the official release, the government said these amendments would better enforcement and monitor traffic rules, leading to decreased driver harassment and improved road safety.


Insurers receive Covid-19 claims of over Rs 4,880 crore

Oct 1, 2020

The trend of claims arising from the novel coronavirus has kept its upward momentum. Senior officials of the general insurance industry said insurers have received around 3.18 lakh claims amounting to over Rs 4,880 crore as on September 29. Market participants say a lot of the claims are now coming from semi-urban and rural areas.

“We have seen claims now coming from across the country. A few weeks ago, we were getting claims only from metro cities. I think incurred claims ratio in the health segment for the general insurance companies will be more than 100% in the second quarter of this fiscal,” said the product head of a leading private insurance company.

Incurred claim ratio is a ratio of the total value of claims paid or settled to the total premium collected in any given year. If the incurred claims ratio is more than 100%, it indicates that insurers have paid more money as claims than it has collected as premium.

Insurance companies have settled over 1.97 lakh claims amounting to Rs 1,964 crore as on September 29. They have have received over 1.35 lakh claims amounting to Rs 1,710 crore from Maharashtra alone. Tamil Nadu and Gujarat have seen 32,830 and 27,913 claims, respectively.

According to the Ministry of Health and Family Welfare, there were 9.40 lakh active cases of novel Coronavirus in India as on September 30. While 51.87 lakh persons were discharged, 97,497 deaths occurred due to the ongoing pandemic.

Recently, ICICI Securities in its report said if one assumed that Covid claims maintain a run rate of $150 million per month (Rs 1,105 crore) from September, the total FY21 Covid claim amount would be around $1.4bn (Rs 10,500 crore).

Health portfolios of the general insurance companies would further get impacted as claims normalise for non-Covid treatment, said market participants. Data from the Insurance Regulatory and Development Authority of India show that health insurance have seen premiums of Rs 22,903.44 crore in this fiscal till August, compared to Rs 20,274.09 crore in the year-ago period, a growth of 12.97%.


Two years on, Ayushman Bharat has ground to cover on universal health care

Sept 24, 2020

Private hospitals suggest private-private partnerships, upscaling of teaching hospitals The Centre’s flagship Ayushman Bharat health insurance programme has completed two years. But this time, the buzz around the milestone has been low-key, coming at a time when hospitals are coping with the surge in Covid-19 numbers.

Launched on September 23, 2018, in Ranchi, the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana has seen over 1.26 crore hospitalisations, involving a spend of over ₹15,772 crore to cover these healthcare bills. In fact, Health Minister Dr Harsh Vardhan said the two-year milestone is as significant as his involvement with polio eradication efforts in the country.

The National Health Authority’s Chief Executive Dr Indu Bhushan said, at an event to herald the two-year milestone, over 23,311 hospitals were on board the scheme covering over 1,500 procedures. The scheme has generated savings to the tune of ₹30,000 crore, he said.

But the scheme still has ground to cover in terms of being more universal in its coverage, say public health voices, even as private healthcare representatives seek greater dialogue to “iron out the wrinkles”.


Making a case for universal healthcare, KM Gopakumar with the Third World Network, points out that a bulk of the middle class remains outside the scheme. And the “package system”, where a set number of procedures are covered for reimbursement by the government, leads to further exclusion of ailments and people, he said.

The scheme is the first step towards providing universal healthcare, said Dr Sudarshan Ballal, Chairman, Manipal Health Enterprises. “Not just the Western nations, but even countries such as Thailand have a well-developed healthcare system,” said Dr Ballal, who is also a former president of NATHEALTH, a platform for hospitals, diagnostics, insurance providers etc.

The last six-odd months have been low-key, he admits, as all efforts have been redirected to tackling Covid. But the effort now should be to dialogue with private providers, address their viability problems and encourage more low-cost or no-frills hospitals, upscaling of teaching hospitals, and even private-private partnerships like the one Manipal Health has with the Tata’s hospital in Jamshedpur for clinical training, he said.

Private players ask for more support

In the early days of the scheme, the pricing of procedures had been a major bone of contention for private healthcare providers, including smaller nursing homes run by medical professionals. In fact, Ballal says, large corporate hospitals are still not entirely participating in the scheme for these reasons.

Lauding the concept of wellness centres, he said there should be attention on prevention and greater screening at the primary centres before a patient lands up at a tertiary care hospital. Hospitals will be willing to get more involved if there was a viability-gap funding mechanism to help hospitals support low-cost procedures. Other alternatives that private healthcare providers have been suggesting to the government include a differential pricing of sorts to support cross-subsidisation of those who cannot pay, by those who can.

Patient woes

Patient experiences, though, include difficulties in getting covered when there are repeated procedures, for instance, as in a chemotherapy that has multiple cycles; or when they travel to a different State for treatment. Presently, Odisha, West Bengal and Telangana are not part of the scheme. These are some of the ground realities the scheme will have to fix, so it can deliver the benefit it sets out to provide.


Be worry-free when making health claims

Sept 24, 2020

Covid-19 has increased the awareness about the importance of buying health insurance. In August, premium collection by stand-alone insurers went up by 25.85% compared to the same time last year, according to data from the Insurance Regulatory and Development Authority of India (Irdai).

However, the awareness about the details of the policies such as coverage, disclosures, sub-limits, exclusions and so on is still a matter of concern as it directly affects the policyholder at the time of claims. This is reflected in the number of claims reported for covid-19 against the number of claims settled: according to data General Insurance Council shared with Mint, from March last week to 10 September, 130,080 claims were settled against the total claims of 207,291. While some of these claims may still be in process, the gap is quite wide.

“The top reasons for health claims to be rejected are non-submission of complete documents, waiting period, non-declaration of pre-existing conditions, non-coverage under policy terms and conditions and fraudulent papers," said Bhaskar Nerurkar, head, health claims, Bajaj Allianz General Insurance Co. Ltd.

We tell you what to keep in mind to not land yourself in trouble at the time of making a claim.

Disclose all details

At the time of purchase, disclosing all information to the best of your knowledge is important. It is best to fill in all the details yourself and not rely on your agent or broker.

Read all the terms and conditions on pre-existing diseases (PED) and waiting period. Concealing details related to pre-existing conditions or family history will only make things difficult for you when a claim arises. Remember that insurers apply a waiting period for some PEDs. Nerurkar said if a claim materializes due to any of the prevailing conditions listed in the terms and conditions of the policy contract, then the claim gets rejected.

“Many times, customers are unaware of this condition or assume that the hospitalization is not linked to the PED or waiting period. This linkage is purely decided by the medical professionals of the insurance company. Sometimes they get in touch with treating doctors to evaluate exact linkages," said Nerurkar.

Even if you feel that a particular surgery was minor and happened long ago, being transparent about the status of the PED at the time of policy purchase is crucial.

Look at the clauses

The annual MintSecureNow Mediclaim Ratings (MSMR) rates down policies that come with sub-limits. If your policy has sub-limits such as a cap on room rent and if you opt for a room with a higher tariff, the insurer will apply proportionate deduction on other expenses too as, typically, most expenses are related to the room rent. This means you will have to pay the balance.

“To avoid paying inflated bills on medicines and incidentals when staying in a deluxe or premium hospital room, try to get a health insurance policy that has no room rent capping or has a higher ceiling on room rent so that it can cover any room you may have to take," said Indraneel Chatterjee, co-founder and principal officer,

The usual, customary and reasonable (UCR) clause to avoid the abuse of services may also affect claims, said Nerurkar. This clause is used by insurers to restrict the claim amount payable in accordance to what they deem reasonable. A lot of claims are settled only partially due to this clause, said experts.

“While the clause is justified in certain cases, it can be misused to restrict the insurer’s liability. It is tough to fight against it unless the insurer has settled the claim with blatant deduction. Hospital charges in India are not regulated and, hence, insurers, based on their experience, decide on how much is reasonable payment for a procedure at a specific grade of hospital," said Chatterjee.

If you have two indemnity policies and the first insurer deducts a chunk of the claim amount, you have the right to claim the balance under the second policy, but it isn’t easily done.

The only way to lower the burden—in case of planned hospitalization—is to get an estimate of expenses from multiple hospitals and choose a reasonable one.

Avoid Hospitaliazation

If your insurer finds that an outpatient claim has been converted into an in-patient claim, there is a possibility of your claim getting rejected. “Sometimes the patient is admitted only to be kept under observation due to the caregiver’s insistence. Such claims are not payable," said Nerurkar.

If hospitalization was indeed required and the claim is still denied, gather all the proof. “Get additional certificates and declarations from your doctor. Show the pre-hospitalisation diagnostic reports. If you can convince the insurer that you were rightfully hospitalized, the claim may get honoured," said Chatterjee.

Ensure that the details shared by you at the time of purchasing the policy match with those filled in the claims form. Attach all relevant documents. “Concealment may lead to repudiation of claim and cancellation of policy contract as well," said Nerurkar. Multiple instances of claim rejection may impact future claims.

If you’ve done all the due diligence and the claim is still rejected, you can ask the insurer to review it. The next recourse is to approach the insurance ombudsman.


[1]      «      3   |   4   |   5   |   6   |   7      »      [62]