22nd April, 2014; MUMBAI: The practice of cross-subsidizing group health insurance is likely to come to an end with the insurance regulator's intervention to check the heavy discounts in this sector. IRDA's intervention to restraint heavy discounts in group health insurance is likely to force general insurance companies to stop the practice of cross-subsidising the portfolio. Increasing competition among general insurers has resulted in severe undercutting in the segment despite of losses. The premium rates have been declined by 5-10% so far this fiscal according to industry experts.
*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
*Tax benefit is subject to changes in tax laws. Standard T&C Apply
My name is
My number is
My name is
My number is
City Living in
Do you have an existing illness or medical history?
This helps us find plans that cover your condition and avoid claim rejection
What is your existing illness?
Select all that apply
When did you recover from Covid-19?
Some plans are available only after a certain time
Group health insurance covers pre-existing diseases from day one so this cover is attractive for both the employer and the insurer. It brings a large number of employees for insurance company under its cover in one go
Insurance companies generally cross-subsidise group health insurance as they get other businesses too like property and fire insurance from corporate.
Individual health insurance is a profitable segment for most of the insurance companies and the premium rates have also been raising over the last three years.
According to the chairman of the Insurance Regulatory and Development Authority (IRDA), TS Vijayan, many complaints had been received on the unfair discounts given to the group insurance policies. Therefore, they wanted to ensure that there are no distortions in the paid premiums for group and individual policies.
The IRDA has asked for details on the pricing structure of these policies from insurance companies through the General Insurance Council. A meeting with all non-life insurers is planned on May 16 to address the issue.
This move of the regulator will ensure that general insurers hike prices in the group health insurance segment according to a senior official at a private general insurance company.
Public interest litigation has been filed by an activist, Gaurang Damani in the Bombay High Court seeking transparency in health sector. Gaurang said that general insurers in order to retain the accounts give priority to group health insurance customers and at the retail level, individual customers are not in a position to take on the insurer.
With five standalone health insurance companies and 23 general insurance companies, the health sector in India is highly competitive.
17 May 2022The brain is one of the most important organs in your body. It is...
12 May 2022India experiences a hot and dry summer season that lasts for up to...
12 May 2022The number of people who require hearing aids continues to grow...
12 May 2022Accidents are unpredictable. Getting injured in an accident not...
12 May 2022A change in weather can bring respite from the scorching summer...