Page 13 - Insurance Times January 2024

Ò»©­

Star Health set to hike Max Healthcare to buy Sa- in six years, the company, initially
slated for revisions in 2020 after a
premiums for some hara Hospital in Rs. 940- three-year gap, deferred its decision
plans crore deal due to the pandemic. Neerja Kapur,

Star Health and Allied Insurance is Max Healthcare Institute Ltd said it chairman and managing director of
set to increase premium rates for will buy Starlit Medical Centre Pvt Ltd New India Assurance, told analysts
certain individual health insurance for an enterprise value of Rs 940 crore, that the insurer is looking to ease the
plans, with an anticipated rise of thus acquiring the ownership of 550- impact on policyholders by implement-
approximately 15%. In February, the bed Sahara Hospital in Lucknow. ing smaller, annual increases rather
insurer raised premiums for its Fam- The company has executed a binding than a substantial adjustment once
ily Health Optima (FHO) insurance share purchase agreement (SPA) for the every three years.
plan, a popular product, by 25%. acquisition of a 100 per cent stake of Kapur said the increase in premium is
due to a spike in medical inflation and
Company officials clarified that the Starlit Medical Centre, which had en-
hike in FHO was the sole increase tered into a business transfer agree- health claims frequency. She said that
since the onset of pandemic. The ment with Sahara India Medical Insti- health claims frequency has gone up
products, currently under review for tute for the purchase of the healthcare due to Covid complications. Also, sur-
a premium adjustment, have not unit on a slump sale basis, Max gery costs have risen at hospitals dur-
experienced a rate revision for sev- Healthcare Institute said in a statement. ing Covid pandemic and remained at
eral years, they added. Distributors The 550-bed Sahara Hospital treats elevated levels.
said Star Health has been known for about 200,000 patients every year and Health continues to out-
its competitive pricing in insurance has a revenue potential of 2 billion ru-
plans. The company is grappling af- pees for fiscal 2024, Max said. grow rest of non-life
ter witnessing higher claims ratio in Industry figures for November 2023
lower-value policies due to medical New India plans yearly re- indicate that standalone health insur-
inflation. The company is realigning ers have been significant drivers of
its growth strategy and concentrat- visions for health insur- growth in the non-life insurance sector.
ing on new distribution channels to ance premiums According to flash figures released by
enhance underwriting margins. New India Assurance, having surged the General Insurance Council, the in-
"We follow a risk-based pricing 50% in the past five trading sessions, dustry generated a premium of Rs
model, regularly evaluating all prod- has opted for an annual revision of 1,88,247 crore in the eight months
ucts. In the short term, we may health insurance premiums, moving ended November 2023 - a 13.8% in-
consider revising prices for a few away from the previous practice of in- crease over the Rs 1,65,359 crore re-
more products beyond Family creasing tariffs every three years. corded in the year-ago period.
Health Optima," said Anand Roy, After a 25-30% increase in retail health Health insurers recorded a total pre-
the company's MD. insurance premiums in June, the first mium of Rs 19,585 crore - a 25% in-

12 January 2024 The Insurance Times