Page 24 - The Insurance Times July 2020

As per census, around 11 crore people (8.30% of population) Hospitals and Third Party Agents (TPAs) also not ruled
are in the age group of above 59 years and another 10 crore out and the regulator needs to focus attention on this
people (7.90% of population) are in the age group of 50 to area.
59 years, will be joining Gen-S club shortly. It is observed
Y The increased GST is also making the health insurance
that approximately 55% of senior citizens are covered either policies costlier.
under government sponsored health schemes or purchased
health policies on their own and the remaining 45% people
The increased premium rates especially in higher age
are left out any health insurance cover.
groups, forces senior citizens to choose the exit route. Truly,
it is an unethical practice and also unwarranted treatment
Among the insured lot, Group Health Policies are playing an being adopted by the Insurers towards senior citizens whose
important role as it has inbuilt features viz., floater policy
contribution to the nation building is invaluable.
covering spouse, children and parents, waiver of medical
check-ups and Pre-Existing Diseases (PED), lower waiting Barring PM-JAY, presently there are no government
periods, cashless hassle-free treatment and low premium
sponsored health insurance schemes for middle-income
rates. However, the flipside points are: group in general and senior citizens in particular. The
Y Normally, under group policy, it is expected that alternative available to this group is either to rely on private
uniform premium is to be levied across the members
sector on payment basis or depend on the mercy of
irrespective of the age. However, the insurance voluntary organizations for free medical services.
companies are levying premium based on the age of
the policy holder which is against the ground rules. In the present scenario, the minimum health insurance

Y The naive policy holder doesn’t have any decisive role coverage required for a family should be Rs.5 to Rs.10 lakhs
in negotiation of premium rates as the aggregator is and the premium quoted by the insurance companies is in
only the competent authority to have dialogue with the the range of Rs.25000/- to Rs.90000/- per annum depending
Insurer. But in practice, they are failing their on the age of the insured. Under these circumstances, the
responsibilities and simply accepting the premium rates pensioners whose annual income is below Rs.5 lakh need to
and other terms without any purposeful discussions earmark minimum one or two months pension towards
with members. purchase of health insurance policy. This is truly a burden to
senior citizens, lest they have to choose an exit route which
Y By and large, the retail policy holder is eligible for “No
is a highly risky and precarious one.
Claim Bonus” while renewing the policy but the same
facility is not extended to group policy holders on the
While appreciating the government moves in improving the
excuse that the premium is low compared to individual
health care in the country duly covering majority of poor
policy. Thus, the insurance companies are conveniently
misusing the guidelines to exploit the policy holders. families under PM-JAY scheme, still many senior citizens like
Y Contrary to the common belief that the group policies
are cheaper compared to retail policies, the insurance
companies have been resorting to hike in premium
rates on an ad-hoc basis on the pretext of ever
increasing medical costs and thus making the group
policy unaffordable especially to senior citizens.
Y The claim ratio, a decisive factor in determining the
premium rates, crucially depends on number and
amount of claims. While the per cent of claims to total
policies remain the same, the claim amount has been
on the rise due to reported increase in service costs of
the hospitals. Further, there is no uniformity and
transparency with regard to treatment charges of
various ailments. The nexus between Networked

24 The Insurance Times, July 2020