Page 27 - Ebook health insurance IC27

Sashi Publications

employees, which is supplemented by the Central and State Governments. The
ESIs cover over 50 million beneficiaries. The ESI was soon followed by Central
Government Health Scheme (CGHS), which was introduced in 1954 and aimed
to provide comprehensive medical care to the central government employees in
civilian assignments and for their families, being partly funded by the employees
and largely by the employer , Central Government. It has a base of around 800,000
families representing over 3 million beneficiaries.

Commercial Health Insurance was offered by non life insurers even before
nationalization, but mainly for large groups. The first standardized health insurance
product in theIndian market, which cover individuals and theirfamilies, for expenses
incurred in hospitalization, was launched by all four nationalized non-life companies
(subsidiaries of then GIC).

This product is called Mediclaim. It covered hospitalization expenses up to a pre-
defined annual limit of indemnity with certain exclusions like pre-existing diseases,
maternity etc.

It underwent several rounds of revisions and modifications, the last being in
2007. Even today, hospitalization indemnity-based annual contract continues to
be the most prevalent form of private health insurance in the country. Health
Insurance is loosely termed as Mediclaim, as a product category, rather than a

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