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Insurance Regulatory & Development Authority of India (IRDAI) has further extend the grace period for renewal of life insurance policies which were due in March.

The new extended date is 31st May as the lockdown has been extended twice by the authorities to fight the Covid-19 pandemic.

Earlier on March 23rd and April 4th, the insurance regulator had announced an additional grace period of 30 days for the policies which were due in the month of March and April.

The regulator while allowing the grace period has kept in mind the difficulty faced by some policy holders to renew their policies on time.

IRDAI said, “On a review of the recent situation of lockdown resulting from global pandemic of COVID-19 across the country and representations received, it has been decided that, for all life insurance policies where the premium falls due in the month of March 2020, the grace period shall be allowed till May 31, 2020.”

IRDAI further said, “All policyholders are requested to note that the objective of grace period allowed is to pay all the premiums due within that period so as to keep the policy coverage in force.”

The insurance regulator also said all the life insurers are equipped with digital channels to provide policy holders to pay their premium online.

(SOURCE: Economic Times- May 11, 2020)

In India, many people avoid buying insurance, thinking it is an unnecessary expense. People in their early 20s believe that they are fit and nothing can happen to them ever. Some, on the other hand, believe that they need to start worrying about health only after they reach 50 years of age. However, that’s not what research tells us. Statistics reveal that 15 – 20 percent of heart attack patients are between 25 and 35 years of age. That’s not only shocking but also scary. So, it’s best not to put off buying insurance.

With the spike in unexpected diseases like COVID-19 and rise in uncertainty, people realise the importance of long-term health insurance plans. It’s always advisable to take an insurance plan as early in life as possible. It allows you to be independent and afford the best quality of care. It reduces the financial and psychological stress that illness can impose on your family.

Now the question is, why should you consider a long-term health insurance policy? Here are the reasons:

1. Hassle-free renewal

A long-term health insurance policy keeps you protected for a minimum of 2-3 years. During this period, you don’t have to worry about the cost of health expenditures. It is a big relief at a time when unannounced diseases are on the rise. Once you enrol yourself with long-term health insurance, you don’t have to worry about renewing the policy at least for the next two or three years. There will also be no hassles of missing the deadline or complicated paperwork. For the long term, it also reduces the pain of hospital fees, and one can be financially independent.

2. Helps you save tax on your income

Long-term health insurance is a basic essential that can also help you on your tax savings. As per section 80D of the Income Tax Act you get to enjoy tax deduction on the premium you pay. So, if you get a health plan for yourself and your parents, then you could enjoy tax exemption up to Rs 50,000. For a few saving taxes through this method might look a difficult option, but it’s not. These are the most convenient options and one can save a lot of tax. Please make sure  you invest in those plans which suit your income.

3. Discounted Premiums

The best benefit that an insurance seeker can get from long-term health insurance is the lowered premium rates. Long-term health insurance plans are likely to come up with a discounted premium as compared with the short-term health insurance plans.

4. May also cover pre-existing diseases

Pre-existing diseases or pre-existing conditions are an important factor in your health insurance. It basically refers to the diseases or ailments you were suffering from at the time you bought your policy. A few insurance companies do give you the options of PED in their long-term insurance plan and one can decide accordingly by going through its terms and conditions.

5. Being able to afford proper healthcare

As we grow older, we need more medical attention and doctor’s visits. Expenses such as hospitalization, daily care, room rent, ambulance and medicines can cost you a bomb. Thus, the frequency and types of treatments can quickly become a financial burden to anyone. Whether for your health, kids or parents, it is always better to choose long-term health insurance plans.

One of the biggest examples of health tragedy is COVID-19 which shook the entire world. In such situations, people dip into their savings or take loans or sell assets to fund treatments. However, the smart thing to do is to take a health insurance plan – this will help you to secure your finances and health at the same time.

Long-term health insurance is undoubtedly the most economical and viable health and practical choice, given the increase in lifestyle diseases in today’s day and age. By getting a long-term health insurance policy, one doesn’t have to bother about health coverage at all and can lead a stress-free life. Therefore, customers must consider various options available and choose a health insurance plan that best suits their medical needs and that of their families.

(SOURCE: Economic Times- May 11, 2020)

KRA- Health Insurance Cost to more

Biggest non-life insurer hikes med rates by 25%

Mumbai: India’s largest nonlife insurer New India Assurance (NIA) has increased premium on health insurance by an average of 25% for individuals. Along with the revision in rates the company has done away with the rate differential based on region and has introduced a uniform rate across the country.

Announcing the company’s results on Friday, chairman G Srinivasan said that although the ratio of claims to total premium in health insurance had improved from 116% to 105% following an increase in group rates, it continued to be a loss-making business. Despite the underwriting losses New India Assurance has reported a net profit of Rs 1,008 crore for FY17—an increase of 22% over Rs 829 crore in FY16. Besides being the largest non-life company, NIA is also the largest health provider in the country.

The Insurance Regulatory and Development Authority of India (IRDAI) allows companies to revise their rates once every three years to keep up with medical inflation. New India Assurance had last revised rates on individual health insurance five years ago in 2012.

( Source : Economic Times. 5th May 2017 )

 

The insurance regulator has asked companies to play an active role in the general meetings of investee companies and engage with the management at a greater level to improve governance so as to increase returns on investments for insurers.

“Insurance companies are significant institutional investors in listed companies and the investments are held by them as custodians of policyholders,” Insurance Regulatory and Development Authority (Irda) stated in a circular. “Therefore, it is felt that insurance companies should play an active role in general meetings of investee companies and disclosures relating thereto.

This will be applicable from next financial year.
The regulator said the state of governance at the companies where insurance companies have invested is important. It has also laid out a set of principles, which insurers will have to adopt. The principles are being uniformly adopted for institutional investors like mutual funds, pension funds, foreign portfolio investors and alternate investment funds

(Source : Economic Times – 24th March,2017)

 

Women in urban India registered a sharp increase in life insurance ownership and awareness over the last 12 months, according to Max Life Insurance’s India Protection Quotient 2.0 (IPQ 2.0) survey released in conjunction with Mother’s Day.

(SOURCE: Asia Insurance Review- May 11, 2020)

KRA- DHFL General Insurance to start operation soon

DHFL General Insurance on Thursday said it has received certificate of registration from the Insurance Regulatory and Development Authority of India (IRDAI) and will start its business operations soon.

The venture has been promoted by Wadhawan Global Capital(WGC), whose flagship brand is Dewan Housing Finance Ltd (DHFL), a listed entity.

Our general insurance venture would help us in our commitment to offer protection and mitigate the economic effects of illness, accidents, death, disability and disasters,” Kapil Wadhawan, chairman of WGC, said in a statement.  (READ MORE)

“It also helps us provide the protection for assets as a safety net to cope with economic consequences of unexpected events,” said Wadhawan, who is also chairman of DHFL General Insurance.

Along with the traditional channels, the focus of this new venture would be to give a cutting edge digital experience to the customer that will empower them to take insurance buying decisions, he added.

“DHFL General Insurance will focus on providing a positive customer experience not only at the point of sale but across the customer engagement cycle to ensure customer retention,” said Vijay Sinha, CEO-designate of DHFL General Insurance.
                                                            (Source : The Times of India 26/05/2017)

Insurance  Regulatory and Development Authority of India (IRDAI) has approved the 2nd tranche of approvals under the regulatory sandbox.

The regulator had invited applications in September 2019 and an evaluation committee constituted by the regulator has shortlisted the applications and sent its recommendation to the regulator.

The approvals for life and non-life insurer is from 1st May 2020 to 31st October 2020.

Sr. No Insurer Proposal Name
1 Bajaj Allianz General Insurance Co Ltd V-Pay Motor Insurance Product
2 TATA AIG General Insurance Co Ltd Standalone Own Damage Agreed Value Two Wheeler Policy
3 Go Digit General Insurance Ltd Network based Accidental Insurance for Rented Motor Vehicle
4 Reliance General Insurance Co Ltd Livelihood Protection
5 TATA AIG General Insurance Co Ltd Parametric Insurance
6 TATA AIG General Insurance Co Ltd Credit Insurance for TReDS Platform
7 Bajaj Allianz General Insurance Co Ltd Total Business Protection
8 ICICI Lombard General Insurance Co Ltd Trade Credit Insurance for SMEs
9 TATA AIG General Insurance Co Ltd Loss Limit Insurance
10 ICICI PruLife Insurance Co Ltd Loyalty program
11 India First Life Insurance Co Ltd Loyalty program
12 HDFC Life Insurance Co Ltd Health India Account
13 ICICI PruLife Insurance Co Ltd Health Savings
14 ICICI PruLife Insurance Co Ltd Outpatient Health cover
15 ICICI PruLife Insurance Co Ltd Disease management
16 ICICI PruLife Insurance Co Ltd Dynamic term cover

 

(SOURCE: Economic Times- April 1, 2020)

Insurance companies have been asked by the regulator, IRDAI, to offer a standard health cover called Arogya Sanjeevani. Gurdeep Singh Batra, Head-Retail Underwriting, Bajaj Allianz General Insurance, says “It’s a straightforward policy, has easy wordings, is easy to understand, and comes with a good coverage at a reasonable price.” These policies come with standard coverages, and features, exclusions, and limitations that are similar to existing products.

(SOURCE: Business Standard- May 29, 2020)

COVID-19 has made us uncomfortable and anxious. It’s also fair to say that it has changed us … and our habits. My colleagues have addressed this pandemic from several angles already, so I’m going to stick to just one – digitalisation.

Throughout human history, every challenge we’ve faced has made us more resilient. This pandemic is yet another example of “life-changing.” So, it’s especially crucial that we understand how the insurance industry can adapt to the changing market needs.

In a piece I wrote for a Swiss Re audience, I wrote of a “Kodak moment” – when companies or industries fall by the wayside because of their stubbornness to adapt or realise that the world is adapting and leaving them behind. Kodak is one example. Other prime exhibits include: Pan Am, Nokia, BlackBerry, Blockbuster Video and MySpace.

The last example is probably one of the more recent examples of how tech so rapidly transformed that a pioneer tech company got left by the wayside.

The Swiss Re COVID-19 APAC Consumer Survey in April 2020 showed that the pandemic has transformed consumers’ view on insurance products and the way they purchase insurance. It is not surprising to see consumers’ interest in Life & Health insurance has increased since the COVID-19 outbreak, especially when insurance companies have proactively contacted their customers.

The survey was conducted in Hong Kong, Singapore, Beijing, Shanghai and a number of Australian cities – all highly connected locations with high-speed networks. Whatever it is called – lockdown, “Circuit Breaker” or social distancing – it has altered our attitudes towards daily life via smartphone, tablet or laptop whether forced or by choice.

Whether we’re buying, selling, ordering, delivering or working, it’s taking place online.

To reinforce this, we have found that consumers express a strong desire to buy new policies and submit claims through digital channels. Drawing on the survey results, the unprecedented environment has now highlighted the importance and opportunities for insurers to elevate their digitalisation plans.

Hybrid models key to retaining policyholders in the wake of COVID-19

The insurance industry has long acknowledged the urgency of undertaking digital transformation. Our survey further illustrates how insurers with stronger digital capabilities will be in a better position to meet consumers’ expectations in future.

For a majority of respondents in the four major markets surveyed, selecting an insurer that is able to process their policies online end-to-end was a priority, with respondents in mainland China topping the survey at 77%. In terms of claims processing, improvements to speed and flexibility when processing claims is key to consumers in Singapore (57%), Hong Kong (55%) and mainland China (66%), especially if they were to make a claim at a time of a public health crisis.

Despite the fact that consumers are looking for online purchases, agents and brokers still have a unique, strong role to play. Respondents across all markets indicate that looking more closely at coverage details will be the biggest influence of the COVID-19 outbreak on their purchasing decisions. This underlines the need for expert – and trusted – advice. It also highlights the ongoing importance of intermediaries in customer engagement, especially when customers are unfamiliar with their specific protection needs.

Therefore, the insurance industry must digitalise our distribution channels in tandem with hybrid models and assisted sales to ensure that consumers are provided with the right information and different options when purchasing insurance. This also represents an excellent opportunity to introduce behavioural economic and human-centred design principles into the insurance customer journey.

Pushing digital healthcare forward with insurance

The physical isolation during COVID-19 has accelerated a trend towards increased digitalisation across industries. This trend is likely to be particularly pronounced in the healthcare industry which has been at the heart of the pandemic.

The global lockdown and ongoing care of chronic patients have raised awareness of the state of play in digital healthcare, remote monitoring and diagnostics. Around half of the survey respondents identified healthcare services (e.g. virtual medical consultation) as the most impactful value-adds. This trend will have both short-term and long-term impact. While shifts in healthcare trends can introduce new risks into our portfolios on the whole, the life & health insurance sector should embrace the opportunities presented by this trend.

With our risk assessment knowledge and partner network, we are keen to support insurers in designing the financial protection that consumers need. A digital healthcare ecosystem has multiple benefits for all of us, and with 5G already being rolled out in parts of Asia, it’s just a matter of time before those that choose not to go down this path will be left behind.

Joining forces to complete the digital customer journey

COVID-19 has prompted consumers to review their own personal protection gap and re-consider the merits of stable, longer-term protection. As we expect stronger customer demand for health and life insurance products, it’s time for us to rethink what values we can add for our customers and how should we speed up and plan ahead for the imminent wave of digitalisation.

The writing’s on the wall (or tablet): Change, adapt to your end-user’s needs or be left behind in another Kodak moment.

(SOURCE: Swiss Re- May 28,2020)

The Indian government is likely to reassess the need to establish a natural catastrophe insurance pool due to mounting economic losses from a series of such events in India over the past three years.

Sources say the government may revisit a pool-like arrangement to offer natural catastrophe insurance covers that would protect property and dwellings from floods, earthquakes, cyclones, landslides, among others, reported Money Control.

Deliberations on a Nat CAT pool have been ongoing for almost five years now. However, due to a lack of consensus on the structure of the pool, it has not yet been set up.

“After Cyclone Amphan, consensus is emerging that there should be cover for dwellings and physical belongings during a natural catastrophe. Traditional insurance products may not be suitable to cover events of such a large scale,” said an official.

Cyclone Amphan caused widespread damage in East India and Bangladesh in May. It was the strongest tropical cyclone to strike the Ganges Delta since 2007, causing economic losses estimated at over $13bn. Insured losses could hit INR4bn ($53m), as per initial estimates.

In the last five years, losses due to catastrophes have led to insured losses of almost INR270bn ($3.6bn).

(SOURCE: Asia Insurance Review- June 2, 2020)

Pension Fund Regulatory Development Authority (PFRDA) has suggested a composite scheme for of social security cover for the unorganised sector workers and low-income individuals where both pension and insurance benefits will be covered.

PRFDA Chairman, Supratim Bandyopadhyay told PTI, “We have given some suggestions to the government. We are thinking whether we can have a comprehensive pension scheme taking along APY (Atal Pension Yojana), Pradhan Mantri Jeevan Jyoti Bima and Suraksha Bima. We are thinking of taking all these products together whether we can have a combined kind of scheme.”

According to him, the scheme can be managed in a way where the APY part will come to the pension regulator and the insurance part to the insurance regulator (IRDAI).

It can be drawn on the lines of Atal Pension Yojana (APY) which will give pension benefits along with insurance benefits too.

The chairman said, “the insurance premium under the government’s schemes targeted for the poor and less privileged are very competitive.”

PFRDA Chairman is hopeful for positive outcomes from the discussion with ministry and other stakeholders.

The pension regulator has asked banks not to deduct subscribers’ dues during the period of April & June as the country wide lockdown was imposed due to contain the spread of coronavirus pandemic.

They have taken the call as many hardships were there and businesses were shut. Accordingly he said, “However, from the second quarter onwards the contributions can be resumed and there will be no levy of any fine or penalty.”

APY has completed 5 years since the launch and has crossed over 2.33 crore subscribers and addition of over 69 lakh subscribers during the FY20.

The PFRDA Chairman said “Banks such as SBI and Airtel Payments Bank brought in 17 lakh and one lakh new subscribers, respectively, during 2019-20.”

While private sector banks are doing there are some challenges for APY to scale up in regional rural banks.
On the challenges associated with pandemic and lockdown, he said, “Times are tough and there may be very tepid growth in adding new subscribers during the first quarter.”

Only 50,000 new subscribers were added in the current fiscal which is below normal and during a normal time they add nearly 2.5 lakh subscribers.

The chairman expects things will improve from July onwards at the maximum time could be September end.

(SOURCE: Economic Times- May 18, 2020)

Insurance companies are working on a standardised insurance product for Covid-19, with the sum assured ranging from Rs 1-5 lakh.

This follows the insistence of the regulator, and directions issued by the General Insurance Council (GI Council) — the apex body of non-life insurers.

The product needs to be offered mandatorily from June 15, and insurers have been given time till June 4 to come up with recommendations, said people aware of the development.

In view of the disparity in claims, the Insurance Regulatory and Development Authority of India (IRDAI) recently asked the GI Council, to come up with ideas for a standard cover.

Though the council is yet to submit its views, industry sources say insurers are proposing the cover for people in the age group of 18-65. Unlike other health policies that mostly cover hospitalisation expenses alone, the specialised cover is likely to include the cost of treatment during quarantine and payment of cash for incidental expenses.

“The standard cover for Covid-19 can have two add-on covers — quarantine cover, and hospital daily cash. If the insured person is quarantined due to diagnosis or suspected infection of Covid-19, the company will pay 1 per cent of the sum assured per day, subject to a maximum of Rs 3,000,” said the draft guidelines reviewed by Business Standard.

Similarly, the company will pay 0.5 per cent of the sum assured per day for every completed 24 hours of hospitalisation, on positive diagnosis of the disease.

Factors such as isolation of patients in hotels are normally not covered under normal health policies. However, with Covid demanding such line of preventive measures, IRDAI has called for inclusion of such clauses in the standard Covid product, said a public sector insurance executive.

Room, boarding, and nursing expenses will be capped at Rs 5,000 a day and intensive care unit expenses at Rs 10,000, while ambulance charges will have a maximum limit of Rs 2,000 per incidence of hospitalisation, according to the draft.

A GI Council official said: “The regulator wants to give more clarity to policyholders, hence a standard product helps in clearly spelling out what is covered, and the conditions under which the ailment is covered.”

The product may remain in force for a year or two, and have some added features that will make it more attractive, while being cheaper than other comprehensive health policies, as it will be covering Covid-19 only. In spite of being a standard product, insurers will be free to price it according to their underwriting understands.

“If we have to popularise the policy, the premium has to be low. This will be one of the options given to policyholders, especially to those who do not have a health cover, as there are high chances of catching the virus now. Compared to other health policies, the premium for the standard health policy will be less,” added the GI Council official.

Insurers are seeing a gradual decline in the average claim payout for Covid treatment. Initially, when claims started trickling in, the average claim size ranged from Rs 2-3 lakh. However, it has reduced to Rs 1.5 lakh now. Despite the decline, many private hospitals are charging high rates because of no standardisation. Insurers have been calling for standardisation in rates when it comes to Covid treatment. However, in the absence of any health regulator, the ball lies in the government’s court.

As of May 29, non-life insurers received 6,900 claims on account of Covid-19. Out of this, 3,300 worth Rs 32 crore have been settled, said people in the know. “There is a general feeling that many hospitals are taking advantage of the situation and overbilling patients. Insurance firms are required to pay this bill. Further, as directed by the finance ministry, insurers — especially public sector ones — cannot refuse these claims,” said the head of a general insurance firm.

“They are required to settle them at the earliest. A standardised product helps, especially in case of patients from hospitals that are not listed as non-PPN (preferred provider network) ones.”

Many insurers have come out with specialised Covid products. Standardisation will help bring more parity in existing products too.

“There are separate Covid products that various insurance providers have come up with. This, however, is an effort to bring a standard product for policyholders to get a clear sense of what is covered and what is not. The idea is to have a Covid-only product that has some extra elements normally not there in a typical health policy, like quarantine add-on cover,” said Sanjay Datta of ICICI Lombard.

(SOURCE: Business Standard- June 3, 2020)

Road traffic is returning to normal across the country after a nationwide shutdown, with motor insurance claims with top insurers surging in May.

The re-opening of businesses and other activities has caused accident-related and maintenance related own-damage (OD) claims to surge in May to 50-60% of normal pre-COVID19 levels, as per indicative trends shared by insurers with The Economic Times.

In April, when the entire country faced widespread movement restrictions to curb the spread of the coronavirus, the claim ratio had fallen to below 10% of routine levels for most insurers.

Mr Tapan Singhel, CEO of Bajaj Allianz General Insurance, said, “We have seen an increase in OD claims in May that we believe is also because of pent-up maintenance issues being reported.”

The widespread destruction in West Bengal and Odisha due to Cyclone Amphan also raised the claim frequency in May. “Over the week, we have also seen a marked jump in claims from eastern states, which we believe is due to damages related to Amphan,” said Mr Sanjay Datta, chief-underwriting & claims, at ICICI Lombard.

(SOURCE: Asia Insurance Review- June 5, 2020)

The biggest nightmare for an individual in this digital age is to see an unauthorised debit in his bank account and realise he has been a victim of an online fraud.

We live in an era of hyper-connectivity which allows us to share information across a wide variety of devices. While offering many advantages, this state of existence has its flip side too. Earlier generations lived in fear of their wallets being stolen from their pockets.

We live in perpetual fear of our banking details and other personal data stored online being stolen, hacked, damaged, or erased. The biggest nightmare for an individual in this digital age is to see an unauthorised debit in his bank account and realise he has been a victim of an online fraud.

(SOURCE: Business Standard- June 6, 2020)

Hospitalizations in the middle of the coronavirus pandemic, even if a patient has not contracted the virus, may add thousands of rupees in out-of-pocket expenses as insurers are unwilling to cover the costs of personal protective gear as they fall in the list of non-payable items.

Patients could end up spending as much as a fourth of their hospital bills on personal protective equipment (PPE) during an extended hospitalization, according to some experts.

The highly contagious nature of the virus and the severity of the outbreak has forced hospitals to make it mandatory for health workers to wear protective gear, including body suits and face shields, adding to the costs of patients, as well as hospitals.

What’s making matters complicated is that costs of PPE kits are not standard. Given the varying and unregulated costs of PPE kits, many insurers are wary of hospitals overcharging them.

Mahavir Chopra, a health insurance expert, said he has seen hospitals levying special charges for care and hygiene to manage covid-19 patients. “These charges include cost of PPE billed at as high as 5,000-9,000 a day; care and hygiene, and waste management charges, which are otherwise part of the room rates,” Chopra said. “The current construct of a health insurance policy does not cover these specialized charges for covid treatment, including the cost of care and hygiene and, hence, insurers are not wrong in making such deductions,” he said.

The Insurance Regulatory and Development Authority of India (Irdai), in its circular dated 27 September 2019, published a list of 68 items that can be treated as optional. The list includes kits that are used for treatment of patients. The regulator has left it to the insurers’ discretion whether they want to pay for such kits.

“Such costs are not covered as they can be treated as optional. The regulator has mentioned ‘kits’ in the list because there are a variety of them available and PPE is just one of them,” said Prasun Sikdar, managing director of ManipalCigna Health Insurance Co. Ltd.

The excluded items, which also include oxygen masks, may account for almost 20-25% of hospital bills. Given that the average cost of covid-19 treatment could be 1.9 lakh, a patient may have to pay as much as 47,500, or 25% of the hospital bill.

This is not a blanket exclusion and insurers are paying for kits wherever it forms a part of the packaged rate. “If PPE kits get billed into the overall room charges, insurers pay for it, but if they are shown separately like in the case of non-covid treatments, then they can be excluded,” said Kapil Mehta, co-founder, SecureNow. Anything that is billed exorbitantly will not be covered, said Dr S. Prakash, managing director of Star Health and Allied Insurance Co. Ltd. “Exorbitant by definition means anything that is above the market price. There are various grades of PPEs. Hospitals can charge up to 1,000,” said Prakash.

Insurers said there’s a problem with the number of kits that are billed as well. Dr Prakash said if there are 10 patients in an ICU and there are four nurses in four shifts, 16 PPEs are used in a day to take care of 10 patients. So each patient should be charged for 1.6 PPEs per day. “If every patient is charged for four PPEs for four shifts, it is exorbitant. If we find such abnormal instances, we won’t cover.”

Insurers paying for PPE kits don’t seem to be picking the tabs for non-covid patients. For instance, New India Assurance, Oriental Insurance, National Insurance and United India Insurance are covering the cost of PPEs for covid patients if it is under reasonable and customary charges, said Dr Suman Tilak, chief medical officer, Paramount Health Services (TPA) Pvt. Ltd. Only New India Assurance has agreed to cover PPE costs for non-covid patients, she added.

(SOURCE: liveMint- May 29, 2020)

Lockdown can be pretty tough, thereby restricting people movement across the city. Now if the thought of driving on empty roads to procure both essentials and non-essentials could make you feel any better from staying locked indoors for long, insurance companies have posed another hurdle, a move that will make you rethink twice before venturing out during the lockdown.

pass

Lockdown rules: Do you have an e-pass before you hit the road?

Considering the lockdown has not been withdrawn completely yet, the drivers are required to procure e-pass before they get going on roads. Now if you do not have an e-pass and in case of an accident on the road, or if a vehicle gets lost, the chances of motor insurance companies rejecting your claims are much higher as an unauthorised movement during lockdown will be treated as an unlawful activity.

So if your vehicle meets with an accident during the lockdown period, then one of the documents the insurance companies will ask to process claims is the permission to travel or E-pass for the driver. Further, the e-pass is issued only for a certain route, destination, and for a limited time period only. In case, you do not hold an e-pass for the route you’re driving, and the vehicle meets with a breakdown, then there are chances the insurance company will reject the claim in such cases.

To remind you once again of the T&Cs of Motor Insurance is that a claim can be rejected if the licensee is involved in any unlawful activity. While there are always exceptions to the norm. In case of those providing emergency services during the lockdown, such as frontline workers and medical professionals, their movement on specific routes has been allowed only with E-passes.

Why reason it out with insurance companies without delay?

The date and time of the incident (in case of a theft or an accident) would determine if a pass was required or not as per the rules and regulations from the Ministry of Home Affairs (MHA) Order on the date is legally tenable.

While lockdown restrictions are slowly getting eased and MHA has allowed for inter-state and intra-state travel, it is important for the insured to mandatorily provide justifications and reason for travel amidst lockdown rules still active in certain containment zones. This rule is only applicable for private vehicles, commercial vehicles are excluded.

Claims by insurance companies for unfortunate incidents during lockdown continue to be processed depending on the practical aspects and facts of the claim. Insured vehicle owners are questioned in case of a delay in submitting the necessary documents as required of the insurance companies.

In order to ensure that the insured aren’t harassed for documentation requirements during these trying times, the General Insurance Council has assured the insured that stringent quick actions will be taken against the insurance companies in case of harassment.

(SOURCE: International Business Times- May 31, 2020)

Once you have paid premiums for a health insurance policy for eight years continuously, your insurer will have to pay all claims as per the policy limits from April 1, 2021 onwards.

Insurance Regulatory and Development Authority of India (IRDAI) in its guidelines on standardisation of terms and clauses in health insurance said that after the expiry of the eight-year moratorium period no health insurance claim can be contested. The exceptions are proven fraud and permanent exclusions specified in the policy contract.

This means policyholders need not wait in anticipation for the health insurer to approve a claim once eight years are over. It is a given that the claim will have to be settled within the admissible limits of the medical insurance product. A similar provision is available for life insurance products as well. Under Section 45 of the Insurance Act, no life policy claim can be contested once a third-year term period is over.

For the modified health guidelines, IRDAI said this will be applicable to products filed on or after October 1. All policy contracts of existing health insurance products that are not in compliance with these guidelines have to be modified during renewal from April 1, 2021 onwards.  If an individual has multiple policies and claims exceed limits in one policy, IRDAI said these persons can choose the insurer from whom he/she wants to claim the balance amount.

Insurers have also been barred from repudiating on grounds of fraud if the insured can prove that the there was no deliberate intention to suppress facts. For premium increases at the time of renewal, IRDAI said customers would have to be informed three months in advance.

Claims settlement

IRDAI said that for all policies an insurer has to settle or reject a claim within 30 days from the date of receipt of the last necessary document.

ln the case of delay in the payment of a claim, the insurer has to pay an interest rate of 2 percent above the bank rate. The latter is a rate fixed by the Reserve Bank of India (RBI) at the beginning of each financial year and it currently stands at 4.25 percent.

In cases where the health insurance claim demands an investigation, insurers have to initiate and complete this process within 30 days from the date of receipt of last necessary document. Here, insurers have 45 days’ time to settle or reject the claim from the date of receipt of last necessary document.

If there is a delay beyond the stipulated 45 days, IRDAI said an interest rate of 2 percent above the bank rate has to be paid to the policyholder from the date of receipt of the last necessary document to the date of payment of claim.

Premium payment on instalments

In case the insured has opted for premium payment on an instalment basis (half yearly, quarterly or monthly), IRDAI said a grace period should be granted for payment.

However, insurance coverage will not be available from the due date of instalment premium till the date of receipt of premium by the insurer. But no interest will be charged if the instalment premium is not paid on the due date. Once the grace period is over, the health policy will get cancelled.

If a claim is filed under such EMI health plans, all subsequent premium installments have to be immediately paid by customer.

(SOURCE: Insurance Alertss- June 12, 2020)

As the general insurance industry goes through an interesting phase amidst the Covid-19 pandemic and successive lockdown. ETBFSI spoke to Anup Rau, MD & CEO, Future Generali India on the impact of pandemic on their organisation, trends in the claims and new business, emerging risks in the ecosystem and what’s on their priority list. Edited Excerpts:

Q. How was the impact of lockdown at FG India and how do you view the GI Industry?
By the time the lockdown was announced we were well prepared and had moved to online, used Microsoft Teams for communication, move hardware and upgraded software in people’s personal devices so when it came to call centers, our underwriting, our customer service, our claims processes or even digitally sourcing policies, we were ready. While the rest of the world was figuring out we were ready and prepared.

If you look at May 2020 numbers we’ve grown over by 12% as compared to last year. Being better prepared ensures we grow and also look at employee benefits, even as we’ve opened up none of our employees go to office for more than two days in a week. The lack of physical infrastructure has made many to learn with new and much better experiences.

In the short term there will be pain, in the medium term it will be good and unsure about the long term but what I see is that there is an increase in the awareness around insurance has gone up.

We don’t know for how long will Covid last but I think in 2021 and 2022 people’s understanding of products will be up and they will understand the nuances of different products and make better choices.

Q. What trends you’ve in the motor and health space?

Everything is digital end-to-end for Motor from sourcing to filing and settling claims. For health the only challenge is medical examination. We’ve issued policies based on Tele-MER.

There has been a reduction in claims in April and the month of May was close to normal and June has come back to normal and it’s back to normalcy. Whatever trends we are plotting show the claims could be higher if we compare to the normal period before covid-19 plus we’re dealing with unknown around how Covid-19 situation plays out.

But on the motor side, there was significant side reduction in April – May but June so far could be higher than regular month.

Q. How was the off-take of covid-19 policies?
The up-take for Covid-19 policy was really good and sold in sachet form in retail stores. A lot of stores were impacted due to lockdown and categories which were being sold. Now the lockdown has been lifted we certainly see more uptake of this product across stories.

Q. How do you approach customisation?

I think in the financial services space there’s very little pull and the customer proposition has to be carefully worked on so what we’ve done is created products where a customer sees a proposition and buys it.

We’ve sold over a million sachet insurance products across future retail. Products like baggage insurance, covid-insurance, etc. Nobody is forcing or pushing them to buy it lying on the retail counter store. The customer will pay extra money and buy the product. The product has to have the appeal, feel and be useful for him.

Innovation is oriented where ensuring it’s not sold but the customer buys it.

Q. How’s your distribution strategy apart from retail?
While no other insurer has worked out or sold policies in the retail space, we do have online sourcing. We’re looking at exploring how we can scale up in the rural segment as well. While we do have the traditional channel like agency the way they’re sourcing customers has undergone a change in the last few months. The method of engagement matters with channel preference. A lot of shift has happened in the digital uptake in the traditional agency channel as the F2F interaction is not possible but happens over a video call or digital channel.

Q. What emerging risks do you foresee in the industry?

A lot of risks around cyber-fraud and cyber-crime have gone up significantly. A lot of people have been complaining where impersonation and misrepresentation is happening and the other is the unknown risk around Covid-19.

Q. How do you view InsurTechs?

We work across multiple InsurTechs right from distribution to different parts and processes. We see it as an opportunity to learn and experiment as the cost of experimenting is low.

Q. What’s your priority at FG?
Our immediate priority is the employees feel protected and secured and we’re one of the few companies who have told them their positions are secured.

My strong belief is that the situation is temporary and the Covid problem will go away and we want to make sure we’re building an organisation with a long time horizon. I see 2021 as a good spot as the demand and appreciation for insurance will go up and the categories will expand beyond traditional motor and health.

My ask from my people is that how do we make sure over the next 6-8 months we can capitalize on the capabilities which we are building today.

(SOURCE: Business Standard- June 16, 2020)

The COVID-19 insurance scheme will be available in three slabs – INR 50,000 ($654), INR30,000 ($392), and INR10,000 ($131), depending on the category of the appliance purchased.

This insurance offer is a part of a larger effort by LG to help in the fight against the COVID-19 pandemic and provide better access to medical services to its customers in these difficult times.

Only Indian citizens aged between three months to 65 years can avail of the insurance scheme and they should have no foreign travel history over the past three months. The insurer shall not be liable for any claim arising from coronavirus for a period of 16 days from the policy commencement date and insurance cover will be provided only to the person on whose name the product has been purchased. The policy will be valid for one year and claims, if any, can be pursued through the LG dealers.

(SOURCE: Asia Insurance Review- June 19, 2020)

Insurance Regulatory and Development Authority of India (IRDAI) has asked all insurers life, non-life and health to provide short term cover against Covid-19 disease.

On 4th March, IRDAI had asked general and health insurers to roll out need based products which cover the cost of coronavirus treatment.

IRDAI said, “With an objective of making available insurance protection to various sections of people in the prevailing COVID-19 pandemic, it is considered that short term health insurance policies providing coverage specific to COVID-19 disease is the need of the hour. Accordingly, all insurers (Life, General and Health Insurers) are allowed to offer COVID – 19 specific short term health insurance policies subject to these guidelines.”

These short term policies are for less than 12 months and insurers are permitted to offer both individual and group products.

Further under the policy optional covers which enhance the policy coverage are permitted but add-ons are not permitted.

IRDAI said, “Insurers are advised to devise inclusive short term health insurance products. Where waiting periods are part of the product, such waiting period shall not exceed fifteen days and General and Health Insurers are permitted to offer both indemnity based and benefit based short term health insurance policies.”

Under this policy lifelong renewability, migration and portability are not applicable.

(SOURCE: BSFI Economic Times- June 24, 2020)

You will be able to buy standard COVID-19 health insurance policies with uniform features, terms and conditions from any insurer from July 10. You can choose between indemnity, or reimbursement, plan – to be mandatorily provided by general insurers – or a benefit-based plan, which can be offered by life insurers too. The premiums will be determined by the insurers.

The standard indemnity-based COVID-19 policy will be named Corona Kavach, followed by the name of the insurer. Despite being COVID-19-specific policy, it will cover the cost of treatment of any co-morbid conditions, including pre-existing conditions, along with the treatment for Covid-19, the insurance regulator said. The benefit-based policy will be termed ‘Corona Rakshak’.

The Insurance Regulatory and Development Authority of India (IRDAI) on Friday (June 26) finalised the guidelines for these products. An indemnity plan reimburses hospitalisation expenses actually incurred by the policyholder to the extent of the sum insured. A benefit-based plan, on the other hand, hands out a pre-agreed lump-sum upon diagnosis.

Indemnity (reimbursement) standard COVID-19 product

The Corona Kavach policy will have one basic mandatory cover, which will be indemnity-based and one optional cover that will be benefit-based. The basic cover, with sums insured ranging from Rs 50,000-Rs 5 lakh, will come with tenures of three-and-half months, six-and-half months and nine-and-half months. Including the waiting period.

Those between 18 and 65 years of age can buy this product, which will be also be offered as a family floater to cover parents, parents-in-law and dependent children up to the age of 25 years. This will be a single premium, limited period policy without any lifelong renewability benefits.

Policyholders can file a claim under this product if they are hospitalised for COVID-19 treatment after testing positive at a government-authorised diagnostic centre. It will cover room, boarding and nursing costs as also expenses related to Intensive Care Unit, surgeons, anaesthetists, specialists and so on. Oxygen, ventilator, diagnostic charges will also be paid for.

Insurers cannot exclude the cost of PPE kits, gloves and masks, which has been the major bone of contention in COVID-19 times.

Moreover, the product will also cover home care treatment expenses of up to 14 days if it involves an active line of treatment and is done on a medical practitioner’s advice, among other conditions. Cost of pulse oximeter, oxygen cylinder and nebulisers will also be covered.

The optional cover, for which policyholders will be charged additional premium, will pay 0.5 per cent of sum insured per day of hospitalisation for up to 15 days. This optional rider can come in handy for meeting sundry expenses not payable under the basic policy.

Benefit-based policy

Named Corona Rakshak, the single-premium plan will pay out 100 per cent of the sum insured as lump-sum if the policyholder is hospitalised – at least for 72 hours – after testing positive for COVID-19. The sums insured under the product, which will carry tenures of 105 days, 195 days and 285 days, will range from Rs 50,000 to Rs 2.5 lakh. The policy will cease to exist once the claim is paid out.

Moneycontrol Take

Since product features and terms are standardised, premium and cashless hospital network will be the key determinants once insurers start rolling out the products.

The dedicated policies can be a good starting point for those looking for cheaper covers to tide over the COVID-19 panic. Since cost of PPE, masks and gloves as also home healthcare are clearly covered, it will offer comfort to policyholders. The 72-hour hospitalisation requirement in the benefit-based product remains a sore point at a time when treatment at home is being seen as solution to ease pressure on hospitals.

However, even such individuals would be better off buying comprehensive health insurance covers with minimal restrictions and sub-limits. Health insurance policies need to be purchased with a long-term perspective since you would need them the most as you grow older. The COVID-19-specific standard covers are limited period products, while regular policies come with lifelong renewability feature.

The pandemic has taught us an important lesson: a health crisis can strike anytime, so it’s best to be prepared at all times, for all kinds of ailments.

Significantly, while it is mandatory for general and health insurers to provide the reimbursement-based standard COVID-19 product, offering benefit-based product is optional for all insurers.

(SOURCE: Money Control- June 27, 2020)

For the scheme, the Ministry of Road Transport and Highways (MoRTH) will set up a Motor Vehicle Accident Fund, reported Press Trust of India. The Fund will have contributions from insurance companies through the General Insurance Council for insured vehicles and for hit-and-run-cases.

According to the central government, the Council will bear expenses incurred on victims of accidents involving insured vehicles and in ‘hit and run’ cases, while the Ministry will bear the costs for victims of motor crashes involving uninsured vehicles.

India has one of the highest road accident rates in the world, with about 500,000 road accidents per annum, in which about 150,000 people are killed and about 300,000 disabled.

The National Health Authority’s IT platforms which are used for the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB PMJAY) may be leveraged to implement the cashless medical treatment for road accident victims. AB PMJAY is the government-backed health insurance scheme for around 500m people in the low-income group.

All road accident victims, whether Indian or foreigner, will be considered eligible for the scheme as its beneficiary.

(SOURCE: Asia Insurance Review- July 2, 2020)

 

Considering impending announcements from the UK government on easing travel restrictions, ROCK Insurance Group has launched two new COVID-19 insurance policies to protect travel businesses and travel agents should customers need to cancel or postpone their trips due to coronavirus-related issues.

Commenting on the new policies, ROCK Insurance Group managing director Antony Martin said, “There has been a great deal of confusion around travel insurance recently and the travel industry has incurred significant costs because of it. We noticed a gap in the market for a solid COVID-protection policy so we wanted to create robust products which clearly outline what is and isn’t included.”

As the world is starting to open up for travel again, Mr Martin said that his firm realises the importance of reinstating confidence among travellers by offering pre-departure cover for the elements that are not covered under package travel regulations as well as cover during their trips.

It hopes that its new policies will help drive customer bookings while ensuring the travel trade is better prepared for any potential repercussions if the pandemic worsens and if any new pandemics emerge.

The first policy is a business insurance that covers agents against cancellation costs in the event that a customer books a holiday and needs to cancel due to testing positive for COVID-19, giving the opportunity for the agent to change the booking and recover additional costs in doing so.

This policy is said to be the first of its kind in the travel insurance market.

The second policy is a consumer travel insurance policy that includes pre-departure cancellation if travellers test positive for COVID-19 (even if this is at the airport) and cannot travel.

It also covers emergency medical care and repatriation whilst travelling should the insured contract the virus whilst abroad. The policy is flexible which means if there is a COVID-19 outbreak at a destination, customers will be allowed to change dates or destination ahead of their trip without incurring administration fees.

(SOURCE: Asia Insurance Review- July 6, 2020)

Covid-19 has impacted all economies very badly. Indian economy has suffered a loss of Rs 10 lakh crores due to Covid-19 .  The insurance companies were on the forefront to deal with Covid related issues and have introduced new innovative policies which among others will cover Job losses, revenue losses and short term policies ” said officials and speakers from insurance industry  on a webinar *”COVID-19 Pandemic and Insurance Industry Response”* organized  by Federation of Telangana Chambers of Commerce and Industry (FTCCI) today at Hyderabad partnering with Visista Insurance Broking Solutions

Opening the webinar Karunendra S Jasti, President FTCCI said “  Covid-19 created a situation where everyone and every sector is affected.  We all look upto insurance industry to come up with innovative products and pro-active user friendly services specially during these times. The need of the hour is to design policies to cover job losses for individuals  and revenue losses for industry . Insurance industry should help mitigate losses and ensure Business continuity ”

The Webinar speakers included

Mr G Srinivasan Director National Insurance Academy

Mr Joseph Augustine CEO Axa XL Reinsurance Co

Ms. Anamika Rastrawar CEO IFFCO Tokio General Insurance Company

Mr Nagaraja Sarma Secretary General of General Insurance council

Moderating the session Mr. Padmarao Sevella, COO Visista Insurance Broking Services Private Limited said “ The Most affected sectors during Covid-19 are :

  •      Hospitality
  •      Travel
  •      Tourism
  •      Malls
  •      Retail
  •      Food
  •      Aviation
  •      Automobile
  •      Supply Chain & Logistics
  •      Construction
  •      Entertainment

The losses were incurred mainly due to

  •      Stoppage of operations
  •      Slump in demand
  •      Logistics constraints

And Unemployment has resulted in loss of wages and salaries pay cuts in lower incomes which resulted in delay / default of receivables.  Lot of self made people were thrown out of occupations ( Care[penters; house maids; vendors; masons; daily wages)

Mr. Nagaraja  Sharma Secretary General of General Insurance council has highlighted the positive steps by Insurance Industry such as

  •      Offered to renew polices without prior receipt of premium
  •      Special health insurance policies are designed in view of special requirements of the Covid-19 treatment
  •      Policies designed to cover loss of income and job to victim due to covid-19
  •      Policies designed to cover expenses for treatment at home during quarantine
  •      Short term health insurance policies introduced

Ms Anamika spoke about how insurance companies have strengthened their systems and are delivering seamless services to the customers in the light of the New work culture of work from home .

Mr Augustine has highlighted the ways global insurance community is dealing with the losses caused by the pandemic.

Mr Srinivasan has opined that the health insurance and life insurance policies have now found wider acceptance and customers are looking to insure themselves.

(SOURCE: hybiz.tv- July 21, 2020)

Messaging app WhatsApp India is set to launch pilot schemes in insurance, micro-pension and lending in partnership with domestic service providers.

Mr Abhijit Bose, head of WhatsApp India, said that the app has already run service delivery pilots with lenders such as ICICI Bank, HDFC Bank and Kotak Mahindra Bank, according to a report by Financial Express.

WhatsApp is yet to get the central bank’s nod to launch full-fledged payments services through the Unified Payments Interface (UPI) channel and has been in the beta stage for over two years now, since February 2018.

WhatsApp also plans to expand its experiment with partners in other financial segments that the Reserve Bank of India (RBI) has highlighted as basic financial services, starting with insurance and micro-pension.

“Over the next year and a half, WhatsApp will be supporting multiple pilots to test potential solutions to solve these distribution problems. These pilots will be done jointly with our partners as well as innovative tech partners in each vertical,” Mr Bose said. Each product will start with a small experiment and based on the results, WhatsApp will co-invest and scale the ones that show promise. “Our ultimate goal is for every Indian to have micro-pension and insurance from one of our partners,” he said.

“The solutions will not be WhatsApp solutions. They will be from our partners — banks and financial-service companies, along with their FinTech partners. We will use the venture model. We will take risks, but we will do it through controlled models and based on user acceptance, we will invest and scale the solutions that deliver results,” Mr Bose said.

(SOURCE: Asia Insurance Review- July 30, 2020)

The insurance regulator, Insurance Regulatory and Development Authority of India (IRDAI), directed all non-life insurers to settle claims for patients treated in temporary or make-shift hospitals.

The regulator told general insurers in circular to consider makeshift or temporary hospitals created/permitted by central and state governments to be considered as a hospital/network provider.

IRDAI in the circular said, “Where any network provider has set up any such make-shift or temporary hospital, such make-shift or temporary hospital shall be regarded as the extension of the network provider and cashless facility shall be made available.”

There have been issues with the Covid-19 treatment cost between insurers and partner hospitals. Recently the General Insurance Council, an association of 32 non-life insurers had proposed a Covid-19 treatment rate chart factoring in different regions.

GI Council said these rates will be revisited on monthly basis. General Insurers could use these rates as benchmark rates in settling claims.

(SOURCE- The Economic Times, BSFI; August 3, 2020)

Chennai: Citing the 4.5 lakh lives covered under the stardardised insurance policy like Corona Kavach within 20 days of its launch, simple and standardised health insurance products will grow the health insurance segment, said Subhash Chandra Khuntia, Chairman, Insurance Regulatory and Development Authority of India (IRDAI).

Khuntia also urged insurers to come out with disease specific insurance products that will enable creation of an eco-system for improving the health of policy holders.

He was speaking at the virtual seminar ‘India Health Insurance – Fast Forward’ organised by Confederation Indian Industry-Southern Region.

(SOURCE- The Economic Times, BSFI; August 15, 2020)