Hospitalisation bills at one time used to be within affordable limits for the majority, but today unless either the employer reimburses or an insurance company pays for it getting treated in super specialty hospitals is a dream.
Turning this dream into reality are some of the new innovative insurance products being offered by 23 private and 3 public sector general insurance companies. If you are covered by a group health insurance policy for Rs.2 lakh by your company and exhaust the limit during hospitalisation for major illness, now you can get cashless treatment for an additional Rs.2 lakh by taking a personal policy from another company.
This new insurance product allows you to dovetail expenses from the first policy into the second one covering entire hospital bill. While motor, health and risk covering for homes and industries have been part of general insurance sector, covering trade credit for exporters, allowing health insurance abroad at cheaper rates for High Net worth Individuals, liability insurance for company officers and directors are some of the innovative products.
While Max Bupa and Apollo Munich are offering this HNI health policy, Bharati Axa proposes to add this to their portfolio.
For trade credit insurance from a litigious society like United States, could have a small sum as coverage, but depending on the payment track record of the importing company overseas Indian exporters can be rest assured of getting their payment with an insurance policy.
Retirement pension plans are popular these days with majority jobs turning contractual and leaving very little post-retirement benefits for the employees. Beyond the employer's group insurance two to three insurance companies have been offering policies to Pay During Service period and gain through coverage post-retirement.
With the opening up of General Insurance sector in 2000-2001 to private companies, best practices from foreign underwriters have come into India turning the earlier ‘Tariff' regime into a ‘competitive' premium era bringing cheers to consumers.
Undercutting
Undercutting in premiums by competing insurance companies have been spoiling the health of many of them and none has been able to make profits from ‘underwriting'. The marginal gross profits if any are coming from the investments being made by these companies in other sectors from the premium collected. “A normal company needs 7 to 8 year to earn profits from underwriting, but concentration of topline business growth, undercutting in premiums, fraud in motor and health claims is taking a toll of the profitability,” opined Bharati Axa Sr. Vice-President Subrahmanyam. B.
Having life insurance makes economic sense for majority of the people as it covers both risk and doubles up as investment avenue giving good returns, in addition to Income Tax benefits. General insurance policies need to be pushed in the market contrary to Life Insurance policies making even motor insurance products hard to sell.
Bharati Axa has come up with an innovative comprehensive insurance product in this segment offering higher coverage for older vehicle too. If fraud by the claimants is eating into the profits of the companies, lack of self-regulation and absence of data-sharing on policy holders among the underwriters (like in case of credit cards) has kept the sector away from full maturity.
