Group health insurance set to get a boost
Group health insurance policies are likely to see a pick-up in demand, with the government making medical insurance cover for workers a pre-condition for the factories and industrial establishments to resume operations.
The direction is a part of the standard operating procedure (SOP) prescribed by the government for the offices, workplace, factories and establishments to be eligible to open ahead of the May 3 COVID-19 lockdown end date.
“Medical insurance for the workers to be made mandatory,” is one of the many of the SOPs that are to be implemented by the facilities.
Following the directive, insurance regulator IRDAI has asked all general and standalone health insurers to offer comprehensive health insurance policies either to individuals or groups to enable the listed organisations, employers or establishments comply with the directions.
It advised insurers to devise comprehensive health insurance products with simple wording, conditions and at affordable cost for industrial and commercial establishments, workplaces and offices. Organisations should be able to “continue the medical insurance policy offered by insurers not only for the present situation but for all time,” said a circular from IRDAI Member (Non Life) T.L. Alamelu.
Welcoming the move, Star Health and Allied Insurance MD Dr. S. Prakash said for corporates, group policies were not an expense, but an investment in the welfare of their staff.
Many of the companies, especially the large ones, were already providing the cover. The biggest advantage of the government directive would be helping improve health insurance penetration, he said, adding that Star Health Insurance looked forward to acceleration in growth post lockdown. Historically, epidemics in recent times had translated into more business for the insurers.
Head-Retail Underwriting at Bajaj Allianz General Insurance Gurdeep Singh Batra said the government directive is bound to improve the business potential. Much would depend on how many firms will resume operations and the number of employees they are likely to call for work immediately. The financial health of the enterprise to buy insurance is also important. The health cover, however, will give the workers a sense of safety and confidence when they return.
During 2018-19, general and health insurance companies collected ₹44,873 crore as health insurance premium, an increase of 21.2% over 2017-18. Health insurance premium continued to grow over 20% year-on-year during the past four financial years, IRDAI’s annual report for 2018-19 said.
In terms of the premium collected, the share of group health insurance at 48% was the highest, followed by individual health policies at 39% and government sponsored health insurance, the remaining 13%.
(This story has not been edited by Insurology staff and is auto-generated from a syndicated feed.)