5 Points to Remember before getting Health Insurance

Bajaj Capital Insurance

The process of Choosing and buying the health insurance is not an easy task because market is flooded with variety of insurance offerings. Health Insurance is a vital part of living healthy financial life because out of pocket sudden medical expenses may cause financial disaster.

Before you start purchasing health insurance, identify your need (what kind of coverage you want), know the exclusions and limitations, check for the network hospitals for cashless claims, room rent capping etc.  In addition, do not forget to compare different health insurance offerings.

Every health insurance comes with certain features, which make it different from others. You need to be very careful to check which fits your needs.

Following are the five aspects that one should know before making any health insurance purchase-

• Don’t Compare Premiums: Never start the health insurance comparison with the insurance premium. Health insurance is a complex plan tightly coupled with the complex services that are necessary to understand. Comparing healthcare insurance product requires deeper insights into the overall insurance contract over and above price comparison. Either you need to get yourself into comparing the features in detail, or take help of an unbiased health insurance adviser.

• Sum assured/Top up plans: The amount of money that any insurance company ensures to pay up to the policyholder is the sum assured. Find out what is the best sum assured amount for you, as medical cost increases day by day in busy hospitals in India. The value if 2-3 lakhs have no value in metros. Top up plans offers you additional coverage at low cost. These plans cover over & above the actual health insurance plan hence increase the sum assured.

• How premium Changes: there are many factors which defines the premium like your age band, number of covered members, pre-existing disease, tobacco product/ alcohol consumption, your lifestyle etc. We always recommend to compare the products before making decision.

• Cumulative Bonus: As per the IRDA norms, each claim free year the policy holder gets a benefit knows as cumulative bonus.  A specified percentage of Sum Assured in increased every year only if the policy is renewed without any break.

• Ensure that you have a good adviser: Find a good health insurance adviser, which gives you unbiased information, without having any influence from any health insurer.

Which is the best life insurance plan in India?

Bajaj Capital Insurance

Insurance policies are not simple to understand, even though life insurance is very complex to understand. Choosing the right life insurance for yourself and your family is an important step to give financial protection to your family members. Number of insurance plans available in the market offered by leading insurers in India such as term insurance, retirement insurance plan, child insurance plan, Unit linked insurance plan, Endowment Plan and many more.

You just have to choose a plan, which suits your need, but this is not an easy task to do. Different insurance clauses may act as an obstacle for you. To overcome such condition there are some possible ways which are as follows:

Need Identification: Everyone needs coverage. Ask yourself why you need life insurance policy. If you have spouse, children and dependents parents or dependent family members – Life insurance coverage is your need to minimize the financial losses if something happens to you.  I strongly believe that changes begin with the understanding and understanding begins with identification. So first, understand the life insurance then after start identification of your need.

Cheapest is not always best: Generally, people think insurance premium is the only thing that matters while looking for a life insurance policy. Infect policy coverage is most important aspect of the any insurance plan. Do not choose any insurance policy with respect to insurance premium, pay insurance premium as per the coverage you get. Extremely low premium life insurance policies offers little amount of coverage and the death befits are too low.

Compare and Choose: Navigate maximum number of policies to choose the best insurance plan. Comparing online life insurance policies is also a good option available these days. In this digitize era, there are such comprehensive online insuranceportals, which provides free insurance quotes from the leading insurers. The benefit of such portals is that, under the one roof you can compare plans from the number of insurers with the insurance premium and the policy details. Such online insurance portals also provide the facility of buying the insurance policy online.

Go for expert advice:After doing a lot of work on insurance policies there is a possibility, you are not getting the right/best plan because you needs are unique so your plan should be unique too. In such condition go for expert advice, an insurance expert can easily understand your need and provides you the best available insurance plan in the market. Nevertheless, remember the most important thing, Insurance agents may not be the insurance expert because they bound in the limitations of the certain policies and they generally offer the plans with the high commission. Going to composite insurance brokers definitely provides an expert advice because they have plans from almost all the insurers in the market.

Life insurance is very important as it protect your loved ones after you if some mis-happening occurs. So do not be in hurry while choosing the life insurance plan. Take your time and do proper analysis before taking any decision. Term Life insurance plan are also available in the marker, which can really provide you insurance with a difference.

Analysis of Health Insurance Premium of Different Insurance Companies of India during 2012-13

Data of Health Insurance Premium for different Insurance Companies of India for year 2012 -13 is now available and the total figure has reached Rs.15341 crores for the year ended March 31, 2013.

S. No.	Insurer	Premium	% Share
1	Apollo Munich	598.75	3.90
2	Bajaj Allianz	594.85	3.88
3	Bharti AXA	195.49	1.27
4	Cholamandalam	287	1.87
5	Future Generali	139.13	0.91
6	HDFC ERGO	521.50	3.40
7	ICICI Lombard	1665.17	10.85
8	IFFICO TOKIO	210.79	1.37
9	L&T	26.37	0.17
10	Magma HDI	0.00	0.00
11	Max Bupa	206.42	1.35
12	National	2372.22	15.46
13	New India	2757.71	17.98
14	Oriental	1491.94	9.73
15	Raheja QBE	0.02	0.00
16	Reliance	295.53	1.93
17	Religare Health	38.39	0.25
18	Royal Sundaram	209.23	1.36
19	SBI	6.74	0.04
20	Shriram	0.00	0.00
21	Star Health	843.80	5.50
22	TATA-AIG	181.87	1.19
23	United India	2642.81	17.23
24	Universal Sompo	55.27	0.36
Grand Total		15341	100.00

Data Source IRDA

On analysis of the data we find that % share of PSU companies is 60.39%. It is higher than overall market share of PSU's in Indian Insurance Market. This means that Health Insurance premium is strengthening the premium figure of PSU’s.

	Rs. Crores	% Share
Public Sector	9264.68	60.39
Private Sector	6076.32	39.61
Grand Total	15341	100

Among the 5 top Insurance Companies we have 4 PSU's and 1 Private Company. ICICI Lombard is at 4th position where else Oriental is behind it at 5th position. These 5 Insurance Companies have captured 71.25% market share. 19 Insurance Companies share 28.75%. Out of there Magma HDI / Raheja QBE are yet to introduce their product.

Top 5 Insurance Companies are
Company	Rs. Crores	% Share of total Health Insurance market
New India	2757.71	17.98
United	2642.81	17.23
National	2372.22	15.46
ICICI Lombard	1665.17	10.85
Oriental	1491.94	9.73
Grand Total	10929.85	71.25

Reduction in premium of Star Health during the year is due to loss of Tamilnadu Government as client during the year. Star Health premium which was over Rs.1000 crores during last year has come down to Rs.843 crores and the benefit has gone to United India which was successful in capturing is business.

There are 18 companies out of 24 who are having market share of less than 5%.

What is the learning from this study?

Is it worthwhile for players having less than 2% share to be in this complicated / complex business of Health Insurance. There are 14 Insurance Companies in this category which means 59% insurance companies of India are in this category and are having market share of less than 2%.

Should these companies focus on other portfolio?  There are so many areas which are not being covered / insured. Health Care Equipment / Medical Equipment are one such area. Most of the companies have put this on decline list.

This is the world of specialization and market share. Let no one ignore it.

Indian Health Insurance Market- 2012-2013

Health Insurance Market continues to be loss making portfolio during 2012-2013

Estimates of Indian Health Insurance Market for the year ending March 31, 2013 are now available and according to it this market has touched figure of Rs.15341 Crores.

Overall loss during the year is Rs.1533 crores.

Corporate portfolio and Group Government portfolio (Schemes like RSBY,) continue to be a loss making portfolio. Retail portfolio continues to be the segment where insurance companies have been successful in reducing the claims figures by following rigid norms. May be the decision of PSU’s to go in for strictness i.e. July 1, 2010 and strengthening of PPN has resulted in good results.

Indications are that State Governments will not increase ( as it was happening 2 years back ) their budget for schemes / subsidy. As on now we are aware of that 4 PSU’s are increasing the premium in Retail segment by 30% (during 2^nd half of 2013). Will it result in increase in Revenue or it can result in some of the clients not renewing their policies.

Health Insurance Portfolio – An Analysis

Few years back we were very enthusiastic about the growth of Health Insurance portfolio. This was especially true during 2007-08, when this portfolio grew from Rs 3210 Cr to Rs 5110 Cr. i.e by 59.20%. Let us look at the growth figures from 2006 to 2013:

% Growth of Health Insurance over the Years

Year	Amount (Rs Crores)	% Growth
2006-2007	3210	14.45
2007-2008	5110	59.20
2008-2009	6634	29.82
2009-2010	8305	25.68
2010-2011	11480	38.22
2011-2012	13184	14.84
2012-2013	15341	16.36

We have drawn graph showing the % growth YOY and, it shows that figure is fluctuating and is becoming less and less attractive as the years have passed by.

Let us try to make projections for next 6 years.

We have done this with growth rate of 12%, 20%, 30% & 60%.

If we achieve figure of 30% then the portfolio will be Rs 56960 Cr. in 2017-2018.

If some one asks me- What should be the growth with which you I will be happy?- I will say it should not be 30% gross but it should be 30% net (as we have to discount for inflation of 10% per annum in normal costs and 20% per annum in health care costs). Let us not be satisfied with meager growth of 16%- let us aim for 60%.

It means we should have growth of 60% year over year and then the figure will reach Rs 160862 crores in 2017-18