At a Round Table on health insurance portability hosted by Moneylife Foundation, leaders from the insurance business express concerns over unresolved issues, ranging from data sharing to the cost to customers
Insurance leaders are unanimous that health insurance portability is a positive for the business and customers. But they have several questions over how it will pan out, when it is introduced in July this year.
At a Round Table hosted by Moneylife Foundation on Tuesday, top bosses raised several issues on this matter that are not resolved, and they made suggestions on how it could be best implemented. The programme at Rachana Sansad hall, in Dadar, was well attended and highly interactive.
According to M Ramadoss, chairman & managing director, The New India Assurance Company Limited, the Insurance Regulatory and Development Authority (IRDA) has come up with this announcement as insurance companies were not able to evolve a common standard product over the last one year.
Portability will allow policyholders to switch over to another insurance company with the same conditions. "The accepting insurer shall provide cover, at least up to the sum assured in the previous insurance policy," the insurance regulator has said. The new facility will also help those policyholders who stick to one insurer throughout, for fear of losing the cover for pre-existing diseases (PED).
Dr Amarnath Ananthanaryanan, CEO and managing director, Bharati AXA General Insurance, said that in spite of teething problems, which will be there in data transfer between insurers, it will lead to the evolution of a common database across insurers.
Sudhir Sarnobat, managing director, Medimanage Insurance Broking, stressed that an independent agency should come forward to create a database of insured in an authentic manner and make it accessible to all insurers and brokers.
According to Pawan Singhal, director - legal and regulatory affairs, Max Bupa Health Insurance, health insurance portability is a win-win situation for both the insurer and insured. There would be challenges in implementation, but in a country like India, where health insurance should be accessible to all and offered to the masses, portability is a clear step forward.
Fali Poncha, executive chairman of IRICS Broking Services and a veteran of the insurance industry, cautioned there were a host of issues still unresolved when a customer is expected to move from one insurance company to another, and that the customer may not get all the benefits he enjoyed previously when he moves to a new insurance company at the same premium. Portability, therefore, would be only due to unhappiness with the service by the old insurer. When an employee who enjoys a group mediclaim policy moves to another employer/location within the country, there is lack of clarity over whether the benefits would be the same on portability.
Mr Ramadoss explained that there was a problem of low awareness on health insurance, as well as low penetration by insurers. He underlined the need to educate customers and said health insurance portability was a minor advantage.
The insurer must have patience, not to make profits from the first year onwards, and the customer must have commitment to stay with the insurance company for long years. Portability may lead to poaching of customers with low claims, leading to public sector insurance companies being left with a larger share of customers in the older age groups.
Portability is available to only 2% of the population which is already insured. Further, portability is limited to carrying forward of only the sum assured and relief on pre-existing diseases (PED). Other issues will be as per the terms and conditions of the new insurance company's products.
Dr P Nandagopal, CEO & managing director, IndiaFirst Life Insurance, said portability should help customers in both intra-insurance company mobility (from one plan to another) and inter-insurance company (from one insurer to another). Insurers who are long-term players would not be affected adversely by health insurance portability.
Moneylife Foundation will present a detailed note to IRDA on the round table discussion with clear suggestions for implementation of portability.
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They are known to collect large sums from the companies and pass on only a smaller sum to the claimants and hospitals, playing away with the balance as float.
In 2009-10 New India alone has paid more than Rs.68 crores to TPAs as per a RTI response.
The entire setup even if it means outsourcing needs an urgent revisit to make it accountable and not arbitrary and autocratic that it is today.
I was CAG empaneled Statutory Auditor of GIC, New India, United India and earlier Indian Mercantile and South India. In the recent past have interacted with service providing hospitals and dealt with TPAs for pre-admission clearances during the last malaria epidemic and my experience was horrible.
( If someone asks -off the record-a decade back it was possible to approve false/forged claims - by agreeing to pay % of claim settelement amount to GIC claims officials).
Anna hazare is fighting to curb corruption -where as General Insurance co.s are doing just OPPOSITE.TPA model is successfully working in many countries.One participant from Banglore confirmed that his parent co.is running a call centre at Banglore for his overseas client as TPA.Can someone throw some more light on this.
(Most of TPA's are directly or indirectly owned by politicians and they exhert pressure or pay kickbacks on PSU General Insurance co.s to avail servicies of their TPAs.-
(comments welcome from ALL).One PSU co changed three TPA's in four years-adding extra work and hasseles for policy holders and agents.Total confusion over ID cards and transfer of claims data to NEW TPA.
This lead to delayed/rejection of claims and hasseles for cashless facilities where ever it was available.
MoneyLife needs to ensure that the White Paper on Portability reaches IRDA well in time but also implemented in toto and not accept the half baked Feb. notification listing only two concerns. Each and every matter listed has necessarily to be addressed.
IRDA is expected to take their role of development of the health insurance domain more actively.They need a focused approach.There is no such Dept yet in the IRDA.Much desired Health Insurance Council, is waiting still in the wings.Such a body could address new issues and give some advisories.Well done ,Money Life.
1. If decide to move from one company to another then Will it have any lock-in period? Whether it will have same or lesser premium than the previous insurance company? Whether I would be able to get immediate NoC from the previous company?
2. There are many companies, providing various products. Unfortunately IRDA has not provided summary picture of all the insurance products on its website. So While choosing new company, consumer will get confused while choosing right product.
3. I feel that Why insurance companies should bring a situation that consumer should thinking about one company to another? Instead Insurance companies, with the feedback from consumers, should think about improving their own service so that consumer will not move out of the company.
I fully agree with Mr.Sudhir Sarnobat that we must have an agency like CIBIL, in the insurance sector, with centralized databank, so that consumers can be rated based their claim pattern.
Thank you MoneyLIFE for organizing such an informative seminar.