Page 13 - The Insurance Times March 2025

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major factor driving these increases is
Millennials continue to drive demand for health the lack of standardised hospitalisation

cover costs in private insurance, unlike
PMJAY, which negotiates uniform pack-
Despite a steep increase in premium for health insurance policies in the last
age rates.
one year, there has not been any decline in renewals and the demand for
new policies, say experts. Senior citizens have reported instances
where their premiums nearly doubled,
According to industry estimates, health cover premiums increased by 1015
per cent across various general and standalone health cover providers in particularly when crossing into a higher
the last one year. age bracket coinciding with an
insurer's pricing revision. The annual
"Increase in health cover premiums are to be understood in the context of nature of health insurance contracts
rising medical inflation in the country and we don't see any adverse impact exacerbates this issue, as there is no
on the renewal of cover on account of increase. level premium structure like in term
"About 25 per cent of our premium comes from renewals," Priya Deshmukh, insurance. In contrast, term insurance
Head Health products, Operations and Services, ICICI Lombard, told. Ac- collects premiums evenly over a fixed
cording to Narendra Bharindwal, Vice President, Insurance Brokers Asso- period, whereas health insurance costs
ciation of India, the increase in retail health cover policies has been higher fluctuate due to rising medical ex-
compared to that in the corporate group cover segment. penses.
One of the reasons for frequent hike in premium is the practice of bracket- Insurers seek clarity on
ing of age groups in deciding the price of cover, he said, adding: "The
younger the person, the cheaper the cover." hike caps for senior health
policies

'Senior citizens' annual To control rising healthcare costs, in- Health insurers are seeking clarity from
surers have been urged to standardise the IRDAI on the implementation of its
health insurance premium hospital empanelment and negotiate recent circular capping annual pre-
hike capped at 10% package rates similar to govt's PM Jan mium hikes for senior citizens at 10%,

IRDAI has directed insurers not to in- Arogya Yojana (PMJAY). particularly how it applies to long-term
crease senior citizens' health premiums An IRDAI statement noted a significant policies and whether rates can be ad-
by more than 10% for without ap- increase in premiums for some health justed upon renewal.
proval as those aged 60 and above see insurance products for policyholders In a circular issued on January 30,
mediclaim policy prices shoot up. Ad- aged 60 and above. The regulator IRDAI restricted all general and health
ditionally, insurers must seek approval noted that premium rates are deter- insurers offering indemnity-based
from the regulator before discontinu- mined by estimated claims, administra- health insurance from increasing pre-
ing health policies for seniors. tive costs, and acquisition expenses. A miums for individuals aged 60 and

12 March 2025 The Insurance Times