NEW DELHI: With several people subscribing to health insurance policies post the outbreak of coronavirus pandemic, insurance companies are expecting a major boost in their businesses in FY 2020-21 and planning more products for customers.
“This is not a particularly good year for insurers, but post Covid-19, there will be a major shift in the insurance priorities of customers. There will be a boost in the number of subscribers. We expect good business in FY21,” said an officer from SBI General Insurance.
The SBI General Insurance recently launched a standard health insurance policy, the ‘Arogya Sanjeevani Health Insurance Policy SBI General Insurance’.
The policy provides hospitalisation cover anywhere in India with the sum insured in the Rs 1-5 lakh range, keeping in mind the rural and tier-II and -III cities.
Currently, most of these Covid-related products are benefit-based, where the benefit, equal to the sum insured, is paid on the occurrence of the event irrespective of the amount incurred. For quarantined patients, the policy offers up to 50 per cent of the sum insured if it does not lead to detection. Going forward, all firms are planning such products for smaller towns.
General insurers have received 900 claims for over Rs 18 crore towards Covid-19 treatment till Monday, according the General Insurance Council, the official representative body of the domestic general insurers.
General insurers have reported 10 per cent YoY decline in premiums in March 2020 including all segments. However, standalone health insurers reported strong growth in premium (up 8 per cent YoY).
The industry feels that post Covid-19, health insurance will likely report strong growth over the next few quarters. The success will be better among standalone players.
Another reason for more people opting for insurance is the expected hike in cost of general healthcare.
“There will be certainly increase in healthcare cost. Forget corona, even costs of general medicare is surging. Individuals admitted for regular surgeries are being levied Covid-19 charges. With regular outpatient departments shut and elective surgeries postponed, hospitals’ revenues are hit,” said a doctor at Max Hospitals.
Medical costs to go up
The expected hike in cost of general healthcare is another reason for more people opting for health covers. Hospitals levy corona fee for regular surgeries as well, because with regular OPDs closed and elective surgeries postponed, their revenues are hit.