PSU insurers set to hike health insurance premiums

MUMBAI: Health insurance premiums are set to rise with public sector insurance companies seeking a revision of rates on individual policies. Market-leader New India Assurance has already filed new rates for which it is seeking approval.

“Our present rates were fixed five years ago and the old rates haven’t kept up with medical inflation,” said G Srinivasan, chairman, New India Assurance. He said that the company was successful in bringing down the ratio of incurred claims to premium from 104% to 88% due to measures such as having a ‘preferred’ provider network of hospitals that agree to the insurer’s schedule of rates.

According to Srinivasan, the company would like to bring down further the incurred claims ratio to 80%.

Also, rates have been hiked on group mediclaim policies. But unlike group policies that are customized products, individual health plans are standard over-thecounter plans and need to be cleared by the regulator.

Insurers say that health rates need to be revised because of sector regulator IRDA’s insistence that all health plans be made renewable for a lifetime. Although New India Assurance managed to generate a profit after tax of Rs 205 crore for the half year ended September 2012, up 216% from last year, this is largely on the back of an investment income of Rs 1,342 crore.