Final project on health insurance

8/20/2019 Final project on health insurance

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TYBBI HEALTH INSURANCE

INTRODUCTION OF HEALTH INSURANCE

India is the first largest country in terms of urchasing o!er arity

and is considered one of the fastest emerging economics in the !orld"

Ho!e#er$ its health status remains a ma%or concern" Infant mortality

rate of India is as high as &'"( !hile it is around )* for China"

Similarly life e+ectancy at ,irth for India is around ('"- !hile it is in

the range of --"./ for many countries" Insurance generally comrises

of life and non0life 1general2 insurance" Health Insurance in Indiacomes under general insurance" The de#eloment of health insurance

in India therefore$ has to ,e seen in the ,ac3dro of the de#eloment

of insurance in general" Healthcare$ !ith glo,al re#enue of o#er Rs"

)"-& trillion is the largest industry in the !orld" The nation of India

!ith a oulation of 4/// million e+eriences a #ast ine5uity that

e+ists in the healthcare industry !ith ,arely * ercent of the

oulation co#ered ,y some form of health insurance$ either social or

ri#ate"

Health insurance schemes are increasingly recogni6ed as refera,le

mechanisms to finance health care ro#ision" The otion of insurance

seems to ,e romising alternati#es as its ools and transfers ris3 of

unforeseea,le health care costs for a re0determined fi+ed remium"

7e do not social security system$ aroriate Health Insurance

Schemes for different sections of the society articularly

underri#ileged and the oor is an urgent need of the hour" Insurance

enetration ,eing #ery lo! and health insurance8s share ,eing

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minimal in the e+isting situation$ the #ast ma%ority of the oulations

are outside the e+isting Health Insurance System" 7ith the oening u

of the insurance mar3et for ri#ate entry and the accomanying hye

it is ,eing hoed that in the days to come$ the teeming oulation of

India can loo3 for health co#erage from an array of insurance

ro#iders that too at an afforda,le rice" The resent series on health

and grou insurance therefore attemts to trace the significance of

health insurance and its ,asic tenets in reser#ing the economic #alue

of the li#es of the citi6ens"

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ORIGIN OF HEALTH INSURANCE

The concet of health insurance !as roosed in 49(' ,y Hugh the

Elder cham,erlen form the :eter Cham,erlen family" In the late 49 th

century$ early health insurance !as actually disa,ility insurance$ in

the sense that it co#ered only the cost of emergency care for in%uries

that could led to a disa,ility" This ayment model continued until the

start of the )/th century in some %urisdictions 1li3e California2$ !here

all la!s regulating health insurance actually referred to disa,ility

insurance" :atients !ere e+ected to ay all other healthcare costs out

of their o!n ac3ets$ under !hat is 3no!n as the fee for0ser#ice

,usiness model"

;uring the middle to late )/th century$ traditional disa,ility insurance

e#ol#ed into modern health insurance" It is not an easy tas3 toregulated health insurance" Some countries including the US had to

launch !ar0li3e oeration to unearth large scale frauds"


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de#eloment of health insurance in e+isting form in India is ,ased on

attern follo!ed in Euroe and America"

Health Insurance or medical insurance schemes had de#eloed inIndia due to industrial relations ro,lems ,et!een the emloyer and

the emloyees" The Cororate Houses used to offer core and non0core

,enefits to the emloyees" The insurance olicies !ere granted to

large Cororate Houses urely on an accommodation ,asis" The co#er

usually offered to the emloyees !as in the nature of hositali6ation

and domiciliary treatment for dental and non0surgical eye treatment"

The ,enefits used to ,e for #ery small amount" There !as no scheme

for indi#iduals and families"

In 49.4$ the Ae+ Body of :u,lic Sector Insurance Comanies i"e"

>IC designed a limited co#er for indi#iduals and families for

co#ering their hositali6ation needs" This !as relaced ,y a

mediclaim olicy in the year 49.( under a mar3et agreement to

ro#ide insurance ,enefits to indi#iduals and grous under a grou

mediclaim olicy" The scheme so introduced !as modified in 4994

and 499( in the light of e+erience and suggestions recei#ed from the

insuring u,lic and medical fraternity" The ,enefit ro#ided under the olicy !as on reim,ursement ,asis on occurrence of a ma%or calamity

in the form of accident?sic3ness to an insured erson"

The first IC in

49.( for eole not co#ered under the a,o#e scheme" :rior to 49.($

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co#er against sic3ness and diseases !ere ro#ided ,y e+tension of

:ersonal Accident :olicy" It is interesting to note that e#en after nearly

t!o decades of health insurance$ the oulation co#ered ,y health

insurance is only 4@ of the total oulation"

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MEANING AND DEFINITION

Health insurance insures you and your family against sudden medical

e+enses" A medical emergency can arise due to sudden illness or

in%ury" 7ith medical e+enses rising$ a health insurance olicy !ould

hel you sail through a ,ad atch" Your medical e+enses !ill ,e

ta3en care of ,y the Insurance comany ro#ided you ay your

remium regularly"

7orld health organi6ation defines health as comlete hysical$ mental

and social !ell ,eing and not merely the a,sence of disease and

in%ury" As er 7H$ a country8s Health Systems comrise of all the

organi6ations$ institutions and resources that are de#oted to roduce

health actions"

Ne! India Assurance Comany Limited$ stressing on the socialsecurity asect of health insurance$ in their !ritten note$ stated

=Basically the hilosohy ,ehind the concet of Health Insurance is

to ro#ide rotection against uncertainty of illness ?accident ,y

sreading the ris3 ,ased on the rincile that =!hat is highly

unredicta,le for an indi#idual is redicta,le for a grou of

indi#iduals" Thus$ insurance is a system ,y !hich Healthcare

e+enditure of fe! unfortunate indi#iduals$ !ho suffer from

illness?in%ury$ is shared ,y many fortunate ones !ho are insured and

e+osed to the same ris3 ,ut remain healthy"

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riental Insurance Comany$ emhasi6ing the financial security

asects of health insurance$ in their !ritten note$ stated =Health

insurance is a financial mechanism that e+ists to ro#ide rotection to

indi#iduals and households from hositali6ation e+enses incurred as

a result of une+ected illness or in%ury" Under the mechanism$ the

insurer agrees to comensate or guarantees the insured erson against

loss ,y secified contingent e#ent and ro#ide financial co#erage for

!hich the insured arty ays a remium" The case for health

insurance rests on three groundsD a2 Illness can not ,e redicted ,2

inancial ,urden of hositali6ation is high and cannot ,e lanned c2

The roortion of eole re5uiring hositali6ation due to illness or

in%ury in any large oulation is small thus ena,ling ris3 ooling"

:ooling of ris3s$ resources$ and ,enefits is the hall mar3 of any

insurance system"

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NEED FOR HEALTH INSURANCE

Health insurance has ,ecome a necessity today ,ecause it lays a

ma%or role in health care" This is ,ecause one ne#er 3no!s !hen

illnesses may stri3e" And in such cases hositali6ation and medication

e+enses can ,e unafforda,le" Health insurance can ro#e to ,e a

source of suort ,y ta3ing care of the financial ,urden of your

family may ha#e to go through"

Ad#ancement in science and technology has ,rought a,out a

re#olutionary change in mans life" It has reduced mortality rates and

increased his life san ,ut at the same time has gi#en rise to a num,er

of other ills" Increasing ollution le#els esecially in metros$ stress

and strain at !or3lace$ cut throat cometition ta3ing its toll are some

of the harsh realities":ollution le#els in certain areas are unimagina,ly high and the areas

are nothing short of gas cham,ers" An indi#idual going to his lace of

!or3 has to send long hours in 5ueues$ inhaling the #ehicular

emissions of oisonous car,on mono+ide gases affecting his health in

the long run" Besides accidents on roads are common features" In such

instances timely afforda,le medical hel is the need of the hour" But

this may ,e easier said than done" Treatment for ma%or illnesses or

accidents can ,e unafforda,le and may lea#e you oorer ,y thousands

of ruees"

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It is esecially !orse !hen the atient needs seciali6ed care"

E+enses are e+or,itant and the situation lea#es you mentally

de#astated also ,urning a dee hole in your oc3et" The family

,alance is affected$ all those comforts of life ha#e to ,e gi#en u and

your family has to ma3e u !ith ,are minimum necessities only"

Health insurance ta3es care of you in such circumstances" It !ill hel

you tac3le such situations !ith ease ,y ro#iding you !ith timely and

ade5uate medical care" The financial ,urden of footing huge medical

,ills is ta3en care of ,y health insurance" Besides if the accident

causes life long disa,ility to the atient$ the earning mem,er of the

family$ the insurance comany !ill come to the rescue"

:rimary health care 0 a ,asic necessity and right of e#ery indi#idual$ is

today only a distant dream" The go#ernment has done recious little in

this regard for the masses and hence the ri#ate sector has ta3en uthe challenge to e+loit the otential of the 9)$'// crore healthcare

industry"

7ith educational le#els going u eole are ,ecoming increasingly

a!are of the need of timely healthcare facilities" But at the same time

the high costs of ri#ate health care is a ma%or deterrent" The need of

the hour is afforda,le health care for all in order that e#en the eole

in remote #illages can ha#e access to it"

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INDIAN SCENARIO

In India$ resently the health insurance e+ists rimarily in the form of

;:$ ,ut most of this amount$

reresenting '".@ of >;: is the share of ri#ate e+enditures and

only 4"*@ of >;: is u,lic e+enditure" f the '".@ ri#ate

e+enditure$ 9."&@ are out0of0oc3et sending of users" In other

!ords$ --"&@ of total e+enditure for health care costs is aid ,yindi#iduals or households 17H$ )//&2 and this huge e+enditure

does not ass through any ooling mechanism" Access to health care

in India is still lo! and !ith only less than 4@ of >;: allotted to

u,lic health$ there is lac3 of ade5uate health infrastructure"

:enetration of


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1UIICL2" Besides these four comanies$ Life Insurance Cororation

1LIC2 of India also offers a fe! health co#ers in a limited manner" At

resent$ .)"''@ of the entire commercial health insurance ,usiness in

the country is shared ,et!een u,lic comanies$ !hile ri#ate firms

manage the rest 4-"&(@"

:arado+ically$ the medical rofessionals are resisting standardi6ation

in treatment coding 3no!n as IC; and cost cutting measures for

ma3ing the medical treatment afforda,le to the ailing" They tend to

forget that that future gro!th of healthcare in a country li3e India

!ould deend uon the de#eloment of health insurance model"

The need for suort from the health domain mem,ers?layers and

the ministry of health ,oth at the centre and the state cannot ,e

o#eremhasi6ed" Ho!e#er gi#en the state of affairs of regulations in

the healthcare sector in India$ it is dou,tful !hether full fledgedinsurance comanies !ould li3e to ta3e healthcare ris3s managea,le

so that insurers may find it !orth!hile to mo#e into the sector in a ,ig

!ay"

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ISSUES AND CONCERNS

All o#er the !orld$ insurance co#erage is ,eing e+tended through *

,asic modelsD i2 u,lic financing and u,lic deli#ery as racticed in

the UF until its recent reforms$ ii2 ri#ate financing and u,lic

deli#ery as the model racticed in the US$ Singaore$ and Tai!an and

iii2 u,lic financing and ri#ate deli#ery as the Bismarc3 model$

ideali6ed national 1u,lic or social2 health insurance scheme racticed

in Canada$ >ermany$ rance$ Gaan and China"

Health care insurance is one such alternati#e that co#ers the ris3 of

ayment for health care" 7illiam C Hsiao 1499)2 of the Har#ard

Uni#ersity undertoo3 a comarati#e study of the three models and

concluded that u,lic financing and ri#ate deli#ery of health care

as racticed in Canada is the ,est among the * models in terms of erformance$ health outcome$ u,lic satisfaction and access to health"

There is ho!e#er$ a school of thought that dou,ts the suita,ility of

this model to Indian conditions on the grounds thatD

i" The si6e of the oulation is far more than any of the countries

!here it is ,eing currently racticed efficiently"

ii" The le#el of the er caita income is far lo!er than in other

countries"

iii"The tye of federal set u India has is different from the rest"

True$ these arehensions cannot simly ,e shunned off ,ut one

redeeming feature of the Indian system is that it has the necessary

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infrastructure 0 si6ea,le u,lic hositals$ not0for0rofit #oluntary

organi6ations lus highly s3illed rofessionals in different 3inds of

medical ser#ices and decades of e+erience in managing insurance

,usiness" 7hat is therefore needed is a ,etter lin30u of these

a#aila,le resources !ith the ordinary consumer at an afforda,le rice"

7ith the oening u of the insurance mar3et for ri#ate entry and the

accomanying hye it is ,eing hoed that in the days to come$ the

teeming oulation of India can loo3 for health co#erage from an

array of insurance ro#iders that too at an afforda,le rice" The

common negati#e factors !hich e#ol#e after loo3ing at #arious health

co#erage hase are

4" uality of ser#ice !hen facilities are o!ned ,y the lan gi#er"

ESIS$ C>HS is grossly inferior Reim,ursement delays J in case out

of oc3et sending and or re%ections of claims

)" Limitations of ser#ices JEither monetary restriction on the amount

a#aila,le er year or non0comrehensi#e care of certain re0e+isting

K chronic ailments"

*" Inade5uate information regarding health$ ailment$ rocedures K

treatments$ cost and outcome

'" :ro#ider malractices

&" Coatings for comrehensi#e total care

(" The Lo! Le#el of


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most of these co#ered ersons ,elong to the organi6ed sector mainly

in sectors li3e Rail!ays$ ;efense$ Central >o#ernment$ etc" 7ithin

this$ only a negligi,le ercentage of the ersons are co#ered under

ri#ate health insurance" If !e are seriously loo3ing at a ro,lem is ,y

resorting to alternati#e a#enues li3e ri#ate health insurance" It is

usually mentioned that it is difficult to ,ring the rural$ illiterate fol3

under the um,rella of insurance" 7hen it comes to health insurance$

this argument !ould not hold any credence as many of the so0called

educated eole themsel#es do not understand the imortance of

ha#ing such rotection" Thus$ there is a monumental tas3 of

con#incing different classes of the society a,out insurance in general

and health insurance in articular"

Let us ta3e a loo3 at ho! health$ as a class$ has ,een erforming in the

Indian insurance mar3et" A commercial health insurance olicy has ,een introduced in the mar3et in the late 49./s and thus it remains

one of the youngest classes to ,e introduced in the industry" In site of

that$ it is third largest class in terms of gross remium1Rs"-.$.*4 la3h2

earned for the 5uarter0ended Gune )//($ after


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more con#entional classes of insurance li3e marine and engineering"

Loo3ing at in isolation$ it has a commenda,le erformance"

But !hen one loo3s at the ercentage of the oulation !ho actually

go for commercial health insurance$ articularly in the rural areas one

could easily reali6e that something grossly !rong !ith the !ay

ri#ate health insurance is ,eing accessed in the country"

n the contrary$ it is commonlace to o,ser#e some mem,er or the

other in many families to ,e hositali6ed in a near,y to!n and in mostof these cases they end u aying huge amounts of hosital hills"

>oing further$ the funding for such casualties is ro#ided ,y the

u,i5uitous moneylender and thus they ,ecome unfortunate #ictims of

a de,t tra" Loo3ing at the imortance of ro#iding healthcare for the

masses$ any amount of hard !or3 should not ,e deterrent" In

accomlishing this huge tas3$ there is a role for e#eryone to contri,ute

in !hate#er manner they can"

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LICENSING HEALTH INSURANCE IN INDIA

Health insurance is one of the most regulated forms of insurance

,usiness in those countries !here it lays a dominant role in financing

of health e+enditures" Siraling healthcare costs and raid

technological ad#ances in the medical field ha#e triggered the need

for cost0containment ,y the health insurers !ithout sacrificing the

interest of the olicyholders or claimants" The nature of loss in health

insurance might result in differences of oinion" All these call for

inter#ention ,y regulatory authorities to rotect the consumers

Ho!e#er$ under the Insurance Regulatory ;e#eloment Authority

1IR;A2 in India$ the o!ers of licensing and regulatory insurance$

including health insurance$ has ,een mandated under an act

arliament" ;esite such a regulatory authority$ #ery little has ,eendone ,y IR;A to lay do!n ground rules for hositals !hich run

health lans and may ,e re5uired to register themsel#es as insurers or

hosital managed organi6ations 1H


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HEALTH SECTOR FINANCING

ne of the ma%or goals for the future health system in India is to

ensure good health for the oulation through access to high 5uality

ser#ices" To achie#e this goal$ there is a need to enlarge co#erage and

rationali6e the current mechanisms for collecti#e health financing"

There are at least si+ dimensions of the choice of health financing

oliciesD

• Identification of ,eneficiaries

• Benefits co#ered ,y insurance source1s2 of financing

•


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HEALTH INSURANCE AS A HEALTH FINANCING TOOL

Attracting additional money for health additional resources may ,e

a#aila,le through insurance ,ecause firstly$ consumers are more

enthusiastic a,out aying for health insurance than aying general

ta+ations$ the ,enefits are secific and #ia,le and secondly$ consumers

are more a,le and refer$ to ay regular$ afforda,le remiums rather

than aying fees for treatment !hen they are ill" >etting ,etter #alue

for money 1or increasing efficiency2

Imro#ing the 5uality and targeting of healthcare 1increasing

effecti#eness2

4" A greater e+licitness and #ia,ility of sending on health ser#ices

occurs as a result of insurance"

)" The third arty institution can secify in contracts the 3inds of healthcare that to ,e ro#ided and can therefore concentrate on

ro#iding cost effecti#eness

*" Consumers$ and their reresentati#es$ !ill demand ,etter 5uality

care ,ecause they can see a definite lin3 ,et!een their ayments

and ser#ices

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HEALTH CARE PRODUCTS

The follo!ing are ,rief descritions of some of the ma%or health care

roducts a#aila,le in !orld mar3ets today"

Caital ;isa,ility :olicies

;isa,ility ,enefits co#er the financial ris3 to the insured of his?her

,ecoming disa,led and are e+ressed either as occuational

disa,ility or the ina,ility to ursue any acti#ity for a li#ing"

Benefits are aya,le in the form of a lum sum or as an income"

:ermanent Health Insurance :olicies

;isa,ility income ,enefits ay a regular income should the insured

e+erience a loss of income uon ,ecoming fully or artially

una,le to follo! their o!n or similar occuation" The ,enefit

usually ays an income either until the insured has reco#ered

sufficiently from the temorary disa,ility to return to !or3$ or has

died or until normal retirement age" A !aiting eriod is usually

imosed rior to the commencement of the ,enefit ayment"

;read ;isease 1or Critical Illness :olicies2

A ;read disease ,enefit offers a ayment 1sometimes an

accelerated death ayment2 on a confirmed diagnosis of a dread

disease" This ,enefit is usually #alid in the case of a limited

num,er of listed diseases$ !hich often include the follo!ing

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diseasesD Heart attac3$ Stro3e$ Coronary artery disease re5uiring

surgery$ Cancer$ Fidney failure$ Surgery for a disease of the aorta$

Relacement of a heart #alue$ rgan translant$ Coma

ther diseases can also ,e included and the ercentage of the sum

assured aid for each disease may ,e related to the se#erity of the

disease"

Long Term Care :olicies

This olicy ro#ides financial security against the ris3 of needing

either home or nursing0home care as an elderly erson" :remiums

!ill ,e aid regularly and !ill cease either !hen ,enefit ayments

commence or earlier 1e"g" at a gi#en age2" A grou #ersion of this

roduct !ould ena,le an emloyer to ro#ide long term care to

retiring emloyees and their souses"

Hosital Cash :olicies

Hosital Cash olicies usually ro#ide the insured !ith a daily

cash amount for the duration of an insured8s stay in the hosital"

urther ,enefits are often added in order to co#er the additional

costs associated !ith any #isit to the hosital" These !ould often

,e in the form of a ma%or medical e+ense olicy

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GOVERNMENT/STATE BASED SYSTEMS

The ,est documented and largest system of health care deli#ery in

India is the di#erse net!or3 of hositals$ rimary health Centres$

community health centres$ disensaries and seciality facilities

financed and managed ,y the Central and State local >o#ernments"

These facilities are officially a#aila,le to the entire oulation either

free or for nominal charges" Along !ith some other net!or3s of

#illage health !or3ers$ maternal and child health rogrammes and

seciality disease re#ention rogrammes these u,lic facilities carry

out a central role in India8s rimary health care system short of durgs

and essential sulies and that they sometimes suffer from lo! morale

and inade5uate moti#ation"

The health facilities made a#aila,le to the u,lic are managed andoerated under the authority of central and state agencies" The state

go#ernments mostly o!n and mange the u,lic sector deli#ery system

and ha#e to ,ear the costs of oeration" But the Central >o#ernment

lays a ma%or role on the lanning$ financing and transfer for

resources that determine ne! in#estment in health facilities and

seciali6ed rogrammes"


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of recurrent costs$ esecially the costs of running hositals" This

system has added to the o#erall inefficiency of u,lic health facilities"

• CENTRAL >ERNHS2 !as introduced in

49&' as a contri,utory health scheme to ro#ide comrehensi#e

medical care to the central go#ernment emloyees and their families"

It !as ,asically designed to relace the cum,ersome and e+ensi#e

system of reim,ursements 1


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• E


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EMPLOYER-MANAGED SYSTEMS

=Emloyer0managed health facilities and the =reim,ursement of

health e+enses ,y emloyers are the other means of health

insurance in India" >enerally$ the u,lic sector underta3ings and ,ig

industrial houses ha#e their o!n disensary and hositals and ro#ide

medicines$ etc$ across the counter$ usually !ithin the comany

remises to!nshi" These include defence ser#ices$ educational

institutions$ articularly uni#ersities also ro#ides medical ser#ices to

their emloyees"In addition$ there are #arious medical reim,ursement

lains offered ,y emloyees for ri#ate medical e+enses in the

ri#ate sector including commercial ,an3s and autonomous

institutions" Also$ in some organi6ation !e may find a self0insurance

system 3no!n as medical ,enefit or medical allo!ance scheme"Under this scheme$ emloyees incurring medical e+enses are

re5uired to su,mit their claims to their emloyees for reim,ursement$

and reim,ursements are not lin3ed to their indi#idual contri,ution"

Such co#erage8s generally #ary according to the emloyee8s salary or

designation" #erall$ the erformance of these systems in India has

,een satisfactory"

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NGO SYSTEMS

Health facilities are also ro#ided ,y #oluntary and charita,le or Non0

go#ernment organi6ations 1N>s2" Some of the imortant N>s are

Child In Need Institute 1CINI2$ Self0emloyed 7omen8s Association

1SE7A2$ Streehit3arni and :ari#ar Se#a Sanstha" The health care

facilities offered ,y these organi6ations are a art of their main

o,%ecti#es" Though$ these are not e+actly health insurance

rogrammes$ yet they ha#e otential to generate a!areness and

associate themsel#es !ith the ma%or health insurance"

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MARKET BASED SYSTEMS

A" >IC IC and its su,sidiaries offer the follo!ing roductsD

1)


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the olicy is in rene!al for the receding three years" Suita,le for

ersons of any nationality ,ut treatment should ,e a#ailed of !ithin

the country and the claim is aid in Indian currency?foreign

currency"

Salient eaturesD

• :ro#ides co#er$ !hich ta3es care of medical e+enses follo!ing

hositali6ation from sudden illness or accident

• Co#er e+tends to re0hositali6ation and ost0hositali6ation for

eriods of */ days and (/ days resecti#ely"

• ;omiciliary hositali6ation is also co#ered"

BenefitsD

• Reim,ursement of medical e+enses

• ;iscount in insurance remium is allo!ed on family ac3age$

cumulati#e ,onus and health chec3" In case of family ac3age

co#er$ a single mem,er can a#ail of the entire olicy limits"

• The remium aid ,y a che5ue uto a ma+imum of Rs" 4/$/// is

totally e+emt from income ta+"

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;omiciliary Hositali6ationD

The term means that a atient can ,e treated at home !hen he is not

in a fit condition to ,e mo#ed to the hosital or !here is no

accommodation in the secialist hosital ro#ided"

• The treatment !as for a eriod not less than * days"

• The su,0limits of sum insured to!ards domiciliary hositali6ation

are furnished in the sum insured and remium schedules"

E+clusionsD

• The facility is not a#aila,le if any illness is contracted !ithin */

days from the commencement of ris3 e+cet in case of an accident"

• Any re0e+isting diseases

• Treatment for contracts$ ,enign rostatic hyertrohy$ hydrocele$

congenital internal diseases$ fistula in anus$ iles sinusitis and

related disorders for 4st year of olicy

• AI;S or conditions of similar 3ind"

Re5uirementsD

A comleted roosal form" If the roser is a M;ia,etic8$ a searate

5uestionnaire comleted ,y the family hysician"

T.Y.B.B.I )9


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2) BHAVISHYA AROGYA INSURANCE POLICY:

Suita,ilityD

Bha#ishya Arogya is a life term olicy !here medical ,enefits are

made a#aila,le after retirement of the insured" Therefore$ ,y aying

remiums during the earning eriod$ one can ma3e a ro#ision for

medical ,enefits after retirement" :ersons in the age grou0 of )& to

&& years are eligi,le for this olicy"

Salient eaturesD

• The olicy ro#ides hositali6ation ,enefits for lifetime after

retirement8s age of the insured"

• :remiums can ,e aid in e5uated annual installments u to the age

of retirement

• :remiums can also ,e remitted in lumsum on one time ,asis"

;iscount is offered for one time ayment

BenefitsD

The olicy comes into force after retirement and ro#ides for

hositali6ation and domiciliary hositali6ation ,enefits$ follo!ing

an accident or sic3ness"

ther conditionsD

T.Y.B.B.I */


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• The minimum sum to ,e insured is Rs" &/$/// and can ,e increased

in multiles of Rs"4/$ /// as a unit$ thereafter"

•

or e#ery Rs" 4/$/// increase of sum insured$ the remium isloaded ,y )/@

•


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3) JAN AROGYA BIMA POLICY:

• This olicy !as introduced in the year0499." It is designed to

ro#ide hositali6ation insurance to oorer sections of the society"

• The co#erage is along the lines of the indi#idual mediclaim olicy

e+cet that cumulati#e ,onus and medical chec3 u ,enefits are not

included"

• The sum insured er insured erson is restricted to Rs" &///?0"

:remium u to Rs" 4////?0 5ualifies for ta+ ,enefit under Section

./; of the Income Ta+ Act" Ser#ice ta+ is not alica,le to the

olicy" The remium aya,le as er the follo!ing ta,le

Age of the erson U to '&

years

'(0&& &(0(& ((0-/

Head of the family -/ 4// 4)/ 4'/

Souse -/ 4// 4)/ 4'/

;eendent child u to )& years 49/ )&/ )9/ **/

or family of )O4 deendent

children

49/ )&/ )9/ **/

or family of )O) deendent

children

)'/ *// *'/ *./

• The olicy is a#aila,le to indi#iduals and family mem,ers ,y duly

comleting the roosal form" The age limit is & to -/ years"

• Children ,et!een the age of * months and & years can ,e co#ered

ro#ided one or ,oth arents are co#ered concurrently"

T.Y.B.B.I *)


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B. LIC COVERAGES:

The Life Insurance Cooeration of India introduced a secial

insurance rogramme in 49.* !hich co#ered medical e+enses for

only four dreaded diseases" It !as !ithdra!n and introduced

su,se5uently in 499&" At resent the modified #ersions are

a#aila,le in the form of t!o roducts #i6" Gee#an Asha and Asha

;ee

42 Gee#an AshaD

eaturesD

• en ended scheme

• Co#ers many surgical rocedure

• i+ed ,enefits for surgical treatment can ,e a#ailed t!ice

1su,%ect to conditions2

• E+clusi#e ;ou,le?Trile accident ,enefit"

• tion to s!itch o#er from e+isting Gee#an Asha lan

Suita,le forD

The Gee#an Asha II lan is at for eole !ho !hose family history

tends to sho! hereditary lineage of maladies and afflictions that

ha#e re5uired ma%or or minor surgery from time to time"

T.Y.B.B.I **


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Secial eaturesD

Under the Gee#an Asha lan$ the ma%or surgical rocedures co#ered

for areD

• Ner#ous system 1non0malignant causes2

• Resiratory system

• Cardio#ascular system

•

Haemic and lymhatic system• Endocrine K cular system

)2 Asha ;eeD

eaturesD

Co#er the ris3 of four ma%or ailments namely$ Cancer 1malignant2$

:aralytic stro3e resulting in ermanent disa,ility$ renal failure of

either 3idneys or Coronary artery diseases !here ,y0ass surgery

has ,een done"

Suita,le forD

The Asha ;ee II 1!ith rofits2 olicy is ,est suited for eole if

they anticiant or ha#e a family history of serious diseases li3e

Cancer$ :aralysis$ Renal failure and Coronary disease"

Secial eaturesD

T.Y.B.B.I *'


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;uring the term of the olicy$ if the life assured is afflicted ,y any

of the ma%or ailments listed a,o#e and the same is esta,lished as er

rules 1in case of Coronary artery disease$ the life assured must ha#e

undergone the ,y0ass surgery2$ the olicyholder !ill ,e eligi,le for

the follo!ing ,enefits$ the olicy is in force for the full sum

assured" Immediate ayment of &/@ of the sum assured

:ayment of an amount e5ual to 4/@ of the sum assured$ e#ery year

commencing from the olicy anni#ersary falling on or after the date

of affliction and ending !ith the olicy anni#ersary receding the

date of maturity or the date of death of the life assured !hiche#er is

earlier"

:ayment of ,alance &/@ of the sum assured and #ested ,onuses on

the date of maturity or on death of life assured$ !hiche#er is earlier"

The ,onuses !ill ,e calculated on the full sum assured e#en though&/@ of the sum assured !ould ha#e ,een aid earlier

A lien for a eriod of one year !ill ,e imosed on all olicies on all

olicies under this lan" If the life assured does not get afflicted ,y

any of the diseases mentioned a,o#e$ the full sum assured and

#ested ,onuses !ill ,e aid on the date of maturity or on death of

the life assured$ !hiche#er is earlier"

Benefits

4" Sur#i#al Benefits

)" Sum Assured and #ested Bonus on maturity"

T.Y.B.B.I *&


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;eath BenefitsD

• NaturalD If the life assured is not afflicted ,y any of the

secified ailments$ the legal heirs get the full Sum assured O

accrued ,onus"

• AccidentalD Accidental ,enefits a#aila,le to the life assured

!hether afflicted or not afflicted ,y any of the secified

ailments"

T.Y.B.B.I *(


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MEDICLAIM - AT A GLANCE:

The :olicy ,asically co#ers reim,ursement of e+enses of

hositali6ation and domiciliary hositali6ation for illness$ diseases

or in%uries sustained" This :olicy is a#aila,le to ersons ,et!een the

age of & and ./ years 1children ,et!een the age grou of * months

to & years can ,e co#ered if one or ,oth their arents are also

co#ered concurrently2"

Basic Co#er

:re hositali6ation Benefits

:ost hositali6ation Benefits

Sonsored Health Chec3 Us

;iscount in :remium for family co#er

T.Y.B.B.I *-


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Basic Co#er D

The insured erson can claim reim,ursement for the follo!ing

e+enditures$ ro#ided they are reasona,le and necessary

incurredD

• Room e+enses

• Nursing e+enses

• Surgeon$ anesthetist$ consultants$ secialists fees

• Artificial lim,s$ cost of organs$ "T charges$ medicines

and drugs and similar e+enses

• NoteD Under no circumstance !ill the reim,ursement

e+ceed the sum insured" In case of a amily


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Any rele#ant medical e+ense incurred !ithin (/ days after

hositali6ation !ill ,e considered for reim,ursement under this

olicy"

Sonsored Health Chec3 Us

A erson insured under this scheme is eligi,le for reim,ursement of

the cost of a comlete medical chec3 u 1su,%ect to 4@ of a#erage

sum insured2" This ,enefit can ,e a#ailed once at the end of a ,loc3

of e#ery four under!ritten 0 claim free years" To ,e eligi,le for this

,enefit you must ensure that the olicy is rene!ed !ithin a !ee3

from its e+iry"

;iscount in :remium0 for family co#er

If you ta3e a


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OVERSEAS MEDICLAIM

At a glance you need idesh Yatra eneral Insurance :lans

a2 :ersonal Accident Co#er ,2


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4" >eneral Insurance :lansD

a2 :ersonal Accident Co#er

If the insured erson suffers any ,odily in%ury during the o#erseas

tri and such in%ury$ !ithin 4) months of its occurrence$ is the sole

cause of death$ loss of sight or lim,s of the insured$ the Insurance

Comany !ill ay u to USP &/$/// as comensation"

NoteD No claim !ill ,e satisfied in e+cess of USP )///$ on death of

the insured erson$ if he?she !as less than 4( years of age at the

time of affecting the insurance"

,2


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e+enses that are ,orne ,y him outside India on account of any

in%ury or sic3ness suffered during the eriod of insurance"

If


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• Claims !ill ,e reim,ursed only to the e+tent they are reasona,le

and customarily incurred !hether in case of medical or dental

attention or transortation"

•


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transortation" urther$ the insurance co#er !ill ,e restricted to

co#er only illness or diseases contracted a,road and not co#er

accidents"

c2 Co#ers Loss of Chec3ed in Baggage

The insured !ill recei#e USP 4$/// from the Insurance Comany in

the e#ent of total loss of ,aggage that has ,een chec3ed in ,y anInternational Airline for an international flight" The insurers

ho!e#er reser#e the right to either relace or ay the intrinsic #alue

of the lost article"

Secific ConditionsD

• The Insurance Comany !ill not reim,urse artial loss or damage

of ,aggage

• No claim !ill ,e aid for items !hose #alue e+ceeds USP 4//$

unless the roof of o!nershi is resented to =


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d2 Co#ers ;elay of Chec3ed in Baggage

The Insurance Comany !ill ay u to USP 4// to!ards necessary

urchases$ to relace items$ in the e#ent of more than )' hours

delay 1from the scheduled arri#al time2 in deli#ery of chec3ed in

,aggage" The ,aggage should ha#e ,e chec3ed into an International

Airline on an international flight from India"

Secific ConditionsD

• The roof of urchase must ,e ro#ided for all items reim,ursed

under this co#er

• Any ayment made ,y the Insurance Comany for delay of

,aggage !ill ,e offset against a claim arising for loss of the same

,aggage"

e2 Co#ers Loss of :assort

In the e#ent of loss of assort$ the Insurance Comany !ill ay u

to USP )&/ to!ards e+enses reasona,ly and necessarily incurred

,y the insured erson in o,taining a fresh or dulicate assort"

T.Y.B.B.I '&


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USP */ is the deducti,le amount and any e+ense ,elo! this

amount !ill ha#e to ,e ,orne ,y the insured erson" urther$ it also

means that from e#ery claim this amount !ill ,e deducted ,efore

ma3ing settlement"

Secific ConditionsD

•

Loss or damage to the assort due to confiscation or detention ,y customs$ olice or other authority !ill not ,e co#ered under this

olicy"

• Claims for loss of assort !ill not ,e entertained if the theft of

assort !as not reorted to any olice authority !ithin )' hours of

disco#ery" An official reort is also to ,e o,tained from them"

• No claim shall ,e aid for loss or theft of the assort if it !as

left unattended ,y the insured erson" Ho!e#er$ if the assort !as

left in a loc3ed room or aartment and the insured erson could not

ha#e stored it in a safety deosit ,o+$ the claim !ill ,e satisfied"

f2 :ersonal Lia,ility Co#er

The Insurance Comany !ill ay u to USP )//$/// in case the

insured erson$ in his or her ersonal caacity$ ,ecome legally

lia,le to ay third arties for accidental ersonal or roerty

damage$ arising from an incident during the o#erseas %ourney"

T.Y.B.B.I '(


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Secific ConditionsD

• USP )// is the deducti,le amount and any e+ense ,elo! this

amount !ill ha#e to ,e ,orne ,y the insured erson himself or

herself" urther$ it also means that from e#ery claim this amount

!ill ,e deducted ,efore ma3ing settlement" This deducti,le alies

only to third arty roerty damage"

• The Insurance Comany shall meet no claims arising from

Emloyers or Contractual lia,ility"• No claims arising from lia,ility to any family mem,ers$

tra#eling comanion$ friend or colleague of the insured$ shall ,e

met"

• Claims arising directly or indirectly from the follo!ing shall not

,e aid"

Animals ,elonging to the insured erson or in their care$ custody

or control"

Any !illful$ malicious$ or unla!ful act"

:ursuit of a trade$ ,usiness or rofession$ emloyment or

occuation"

!nershi$ ossession$ or use of #ehicles$ aircraft$ !atercraft$

arachuting$ hand gliding$ air ,allooning or use of firearms"

Legal costs of any roceedings that result from any criminal or

illegal act"

Insanity$ use of alcohol$ drugs 1e+cet as medically descri,ed2 or

drug addiction"

T.Y.B.B.I '-


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Suly of goods or ser#ices"

Any form of o!nershi or occuation of land or ,uildings 1other

than occuation only of any temorary residence2

)" Secial Insurance :lanD

a2Insurance :lan for Cororate re5uent Tra#elerD

This is a one0year co#er issued to emloyees of comanies !ho ha#e

to tra#el a,road fre5uently"

eaturesD

• Each tri should not e+ceed */ days" This eriod can ,e e+tended

,y - days !ithout any e+tra charge$ if the delay is ,eyond the

control of the insured erson"

• The insured erson can ,e ,et!een 4. and -/ years of age" The age

limit can ,e e+tended to -& years at the otion of the Insurance

Comany and after such erson undergoes a thorough medical

chec3 u" The


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• The


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MICRO HEALTH INSURANCE IN INDIA

Health ris3s and resulting catastrohic financial losses are ro,a,ly

significant threats to the eole$ articularly ersons ,elonging to

lo!er income grous as these eole !ill ,e e+cluded from ri#ate

health insurance" A health shoc3 leads to direct e+enditures for

medicine$ transort and treatment ,ut also to indirect costs related to

loss of !ages" Since studies ha#e found a #ery strong lin3 ,et!eenhealth and income oor are the most susceti,le to a health shoc3"

>i#en the ro,lem !ith u,lic health deli#ery system$ the access to

and utili6ation of these facilities remain ro,lem" Strategy to imro#e

the access ,y de#eloing insurance system to ri#ate ro#iders has

,een one such area" or lo!0income eole in rural and informal

sector mar3et ,ased insurance such as


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!hich are of local origin ha#e more chance of attracting more

mem,ers ,ecause of high le#el of trust !ith them"

Se#eral community ,ased organi6ations in India ha#e focused on

de#eloing community ,ased insurance schemes during the last

decade"


52/61


,e a N>$ Trust$ Hosital or Cooerati#e etc" their role can #ary from

erforming as intermediary !here ,oth treatment and insurance are

ro#ided ,y intermediary itself or !here the treatment and insurance

are ro#ided ,y third arty"


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THIRD PARTY ADMINISTRATORS

It8s an institution !hich facilitates a system of cash0less settlement of

medical ,ills for the insured under health insurance has ,een

introduced in India as recently as )//4" The first set of comanies !as

gi#en licenses in


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articularly ,e ,eneficial to those sections of society for !hom

5uality healthcare has al!ays remained a dream"

By rocessing claims !ith due diligence$ T:As are e+ected to

control claims costs for the insurers" In the long run$ T:As are

e+ected to ,ring in greater rofessionalism in the health insurance

industry$ !hich !ould augure !ell for the gro!th of this segment of

insurance ,usiness" T:As are licensed ,y the Insurance Regulatory

and ;e#eloment Authority"

The criteria for licensing are

nly a comany !ith a share caital and registered under the

Comanies Act$ 49&( can function as a T:A"

Comany shall not engage itself in any other ,usiness"

The minimum aid u caital shall ,e Ruees ne Crore in e5uity

shares"

T.Y.B.B.I &'


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FURTHER ISSUES RELATING TO HEALTH INSURANCE

POLICIES:

The Legislati#e En#ironment

A fine ,alance ,et!een go#ernment imosed regulation and self

regulation ,y the industry needs to ,e found" It a articular industry

is =o#er regulated it stifles inno#ation and de#eloment" n the

other hand =under regulation can result in un!anted ractices and

=fly ,y night oerations"

Socio0Economic En#ironment

The socio0economic en#ironment has a significant imact on the

tye of health insurance olicy that consumes !ill loo3 to ,uy" If

!ill also ha#e an imact on the claims atterns of consumers" or

instance$ in a relati#ely oor society$ roduct demand !ill ,e for

roducts that co#er day0to0day ,asic medical care" This !ill tend to

,e roducts !hich ha#e high fre5uency of claims !here the

a#erage claim si6es are relati#ely lo!"

T.Y.B.B.I &&


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:ost Retirement Benefits

Another challenge for the insurance industry is ho! to deal !ith

ost retirement medical ,enefits" ne ossi,le !ay of dealing !ith

these is to use some form of endo!ment roduct 1 !here remiums

are aid during the !or3ing life of the insured2 to ro#ide a lum

sum at retirement date !hich can ,e used to r0fund medical

e+enses 1or a future


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additional comlication of matching assets and lia,ilities" This is

an area !here actuarial %udgement is essential"

Cross Su,sidies

The issue of cross0su,sidies is another item !hich needs to ,e

carefully considered ,y any insurer" There often tends to ,e cross0

su,sidies in health insurance olicies and in articular in medical

e+enses olicy" E#en !hen legislation does not force cross0

su,sidies$ it is 5uite common for there to ,e cross0su,sidies in

health Insurance roducts" The insurance comany needs to

e+amine the le#el of the cross0su,sidies and ensure that the style of

their roducts is such that anti0selection !ill not result in a,use of

these cross0su,sidies"

Ris3


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AI;S

The challenges that faces health insurers is ho! to deal !ith AI;S

claims$ and !hat roduct can ,e designed that meet the needs of

AI;S suffers" This is a challenge that has not$ in any mar3et$ to my

3no!ledge$ ,een fully addressed" In some Southern African

countries$ insurance comanies are offering certain anti0retro#iral

treatments in order to e+tend the e+ected life san of their olicy

holders" This is one area !here health Care


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at each ill health incident$ has to ta3e a conscious decision !hether

or not to dra! on sa#ings and delete his !ealth"


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o#er ser#icing and hence higher costs is laced in the hands of the

doctors" It !ill then ,e u to the doctor to ensure that mem,ers

recei#e aroriate ser#ices !hich !ill costs the doctor and not the

insurer more"

CONCLUSION:

The >o#ernment of India$ in one of its economic sur#ey reorts$ has

roclaimed that human de#eloment is the ultimate goal of IndiaQs

de#elomental lans" It is also ,eing reali6ed that sound long0term

de#eloment of social sectors$ such as education$ and health is crucial

to sustain economic gro!th in an increasingly integrated !orld

economy" The go#ernment can inter#ene in the health insurance

mar3et in t!o !aysD ,y directly ro#iding su,sidi6ing insurance or ,y

regulation" These t!o forms of inter#ention do not lead to identical

T.Y.B.B.I (/


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results" :ro#ision of artial u,lic insurance$ e#en sulemented ,y

the ossi,ility of oting out$ can lead to second ,eat e5uili,rium"

Regulation of the ri#ate insurance mar3et ,y imosition of a

standard contract or ,y restricting remium rates$ on the other hand$

can e+acer,ate the ro,lem of ad#erse selection and lead to chronic

mar3et insta,ility"

There is yet another criticism a,out the Indian health deli#ery systemD

ur,an ,ias in the allocation of resources" As of 9/094$ (("9( ercent of the resources sent on health care had gone to the ur,an sector !hich

accounts for )&"- ercent of the total oulation$ !hile only **"/'

ercent of the resources had gone to the rural sector$ !hich accounts

for -'"*/ ercent of the total oulation" The er caita e+enditure

on health care of the ur,an sector !as said to ,e around Rs"4&) as

against Rs")( of the rural sector"

The >o#ernment ,eing the central layer in the health care deli#ery$

the system is suffering from financial constraints and inefficiency in

allocating !hate#er resources a#aila,le" It is slo!ly ,eing reali6ed

that sole reliance on the u,lic health care system is no longer

desira,le"

Final project on health insurance

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Transcript of Final project on health insurance