Loss of key Govt projects hits Star Health in Tamil Nadu

CHENNAI: Star Health and Allied Insurance Company, the Chennai-based India's first standalone health insurance company, has had to go this year without the Rs 800 crore in premium from government projects it earned the previous year.

This was disclosed by its Chairman and MD V Jagannathan during a press conference in Chennai. The loss in premium monies from Tamil Nadu, where the AIADMK led government scrapped the previous DMK government's health insurance scheme last year, was alone Rs 600 crore. Andhra Pradesh, where the State has decided to run its own insurance schemes, accounted for another Rs 200 crore revenue opportunity miss for Star.

Still, the insurer hopes to end this fiscal with Rs 1,200 crore in premium monies, same as last year. This has been achieved by tweaking the business mix, with a focus on the private retail segment.

Yet, Jagannathan said, "If we are able to get business with a reasonable premium we will continue to do it with other State Governments."

The AIDMK regime, which came to rule Tamil Nadu in May last year, scrapped a health insurance scheme called Kalaignar Insurance Scheme (Kalaignar Kapitu Thittam), a pet project of DMK leader M Karunanidhi. Star, which was the service provider, was asked to wind up.

In November, public sector insurers such as United India, New India Insurance Company, Oriental Insurance Company and National Insurance Company were short-listed under an alternative scheme.