Moneylife » Life » Moneylife Events » IRDA chairman underlines that nobody should be refused an insurance but admits enforcement may be lacking
IRDA chairman underlines that nobody should be refused an insurance but admits enforcement may be lacking
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| 16/05/2012 07:47 PM |
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Speaking at a Moneylife Foundation seminar, IRDA chairman J Hari Narayan also said prohibiting banks from selling insurance products is not feasible in India
J Hari Narayan, chairman, IRDA (Insurance Regulatory and Development Authority), said no party should be refused an insurance policy and disability should not be a ground for rejecting insurance. It is also against the rules to refuse medical insurance to senior citizens, he said. However, he admitted that enforcement on the ground may need to be tightened. He was speaking at a small interactive session organised by Moneylife Foundation with senior citizens and physically challenged. The IRDA chairman said that he would look into the issues raised by the group of senior citizens and activists.
The IRDA chairman later addressed a packed public meeting on the topic whether sensible health insurance is possible in India. On prohibiting banks from selling insurance, Mr Hari Narayan said that this is not feasible in India, though countries like Canada do have such stringent policies. Issues relating to life insurance, mis-selling, bancassurance, lapsed policies and poor grievance redressal were also discussed.
Health insurance is a cause of concern for everyone. With rising medical inflation and annual hike in health insurance premium, quality healthcare seems to be a distant dream, except for the elite who can afford the expensive hospital treatment or pricey health insurance premiums, the activists said.
The common issues that most citizens face are rising health insurance premium, inability of senior citizens' to increase sum insured, TPA (third party administrators) and intermediary issues and restrictive mediclaim policies. There were complains that more and more claims are getting rejected for impractical reasons and cashless facility restricted to few hospitals.
Moneylife Foundation, in a memorandum presented to the Mr Hari Narayan, raised these and others issues along with suggested actions.
Regarding handling health insurance claims, Mr Hari Narayan pointed that the system was working well, by and large. He pointed out that last year out of the 47 lakh claims received, 9.4 lakh claims were rejected. He pointed out that 80% of the claims are met and the industry has paid out as much as Rs5,885 crore. More than half the claims were settled within 30 days. He pointed out that the most frequent claims are from fever due to unknown origin followed by cataract.
Sensible universal health cover for masses is certainly a possibility in India, the IRDA chairman said. The government-initiated products like RSBY (Rashtriya Swasthya Bima Yojna) has done well for the masses with premium as low as Rs400 per family for a cover of Rs30,000 sum insured. They cover primary and secondary health care. Arogya Shree is another success story in Andhra Pradesh which covers tertiary health care i.e. covering only if any procedure is performed. A product, which is a combination of two can be promoted to masses for bulk penetration. This can be offered to certain section of society at nominal cost.
The other half of the population, which is at a higher income level can buy this product at a higher rate, which will still be much lower than an individual mediclaim product. The product may be up to certain sum insured. If anyone needs higher sum insured, they can buy 'top-up' policy to cover over and above the sum insured, which is offered by this mass product, Mr Hari Narayan said.
The seminar was attended by a number of activists, experts and eminent citizens.
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Comment
MJ 1 year ago
The Irda regulator has a dual role of not only supporting the consumer's right but also ensuring the sustainability of the industry, hence an argument ofaccusing a regulator to be pro industry or pro consumer is invalid and wrong. Of all the concerns raised we seem to ignore some obvious facts 1. Although some banks may not be selling the right products currently they (banks) still offer the widest reach as compared to any other distribution that exists in the insurance industry. And anyone can recognize the key to increasing insurance distribution which is a key need is reach. What needs to be done is not prevent banks from selling but ensure a right sell.
2. Medical coverage to senior citizens is definitely a requirement but what do we expect , that the same would be provided for by private institutions. The only way insurance can be affordable to senior citizens is by either ensuring cost of premiums are kept low by subsidizing against premiums of the younger population ( which is unfair to the younger persons who ensure coverage in time) or ensuring adequate provision by the govt in the form of subsidies ( remember even the rsby scheme would not be successful without sufficient govt support and currently rsby schemes may not be sustainable at current rates hence requiring further govt support)
3. Let us not make a mistake of trying to solve social problems by depending on private companies which can only exist if they are profitable.
PCP 1 year ago in reply to MJ
Right selling by Banks:How to ensure it? Firstly train the Bank staff on products before allowing them to sell.Secondly there should be monitoring on the quality of sales.Can RBI do it?No,then IRDA need to devise mechanisms .Thirdly what is the punishment for wrong doings.This should come under the disciplinary code of conduct for Banks staff.
2.Part of the cost for senior citizens medical insurance should come from Govt like in some western countries.But there are many ills in the present health care system which can be cured by the approach adopted by Narayana Hrudalaya.The premiums are affordable,services are trustworthy and reliable and customers trust the delivery mechanisms.No unnecessary tests and generic medicines at fraction of branded drugs available.
MJ 1 year ago in reply to PCP
Completely agree that a honest, transparent and fair collaboration between insurer's and service providers would provide adequate control of medical costs thereby reflecting in control of premiums.However considering present scenarios where service providers find no adequate incentive or regulations governing them it seems quite impossible. Hence what is required is a centralized effort ensuring standardization of treatment protocols, costs and recommended usage of generic variants governed by a industry and government recognized body.
eajaz 1 year ago
IRDA Chairman, should visit to any Banker and see the way the bankers are selling the insurance plans like selling some vegetables, ... who cares every thing is chalta hai in India especially when big players are involved...public is the sufferer
s
prakash praharaj 1 year ago in reply to eajaz
A good suggestion and IRDA should see how Banks are selling insurance!
G N GHOSH 1 year ago
The chairman may be right on prohibiting banks from selling insurance as he said that this is not feasible in India.
But one thing he can do by not allowing banks selling insurance products - life ,non-life, health from its bank premises or counter under the same roof.
Bank is a broker of the insurance company and it has to open separate offices for doing that business rather than sitting in the branches where the premises is meant for the banking transactions.
executives sitting in the bank and other employees including staffs in cash counter is running after customers to put their money in insurance products to get incentive, bonus and gifts.
IRDA should look into this angle and take necessary steps to stop missale.
prakash praharaj 1 year ago in reply to G N GHOSH
You are right.Infact Bank staff are now after cross selling incentives than providing services to banking customers
Secondly they do not understand the product but try to sell which results in misselling.
Thirdly an insurance product needs explaining and time which bank staff can illafford.
Samar 1 year ago
Sr citizens should be sold mediclaim as a part of social health care security.It has to be a targeted campaign for all insurer.IRDA must make a must sales campaign.Have we seen an ad campaign for insurance cover for sr citizens?
J Udaya Shanker 1 year ago
I have studied almost all comments. There are several problems in Health Insurance in India. Only one answer to all these problems. IRDA should ask all the insurance companies to design only one type of policy with ratings, deductions, exclusions, terms & conditions for retail customers, group policies. The rating should be only one if the customer goes to either Bank, Insurance company or a Broker. Till then, even the Chairman also cannot answer for the questions raised by sr.citizens/activists. If it is not possible to prohibit insurance products through Bankassurance, minimum the IRDA should take steps to stop selling to Credit Card holders through telecallers. If the IRDA take steps to set up the universal business code for all the Companies/ Bancassurances/Broking firms, then it is possible to solve some of the problems in Health Insurance.
Samar 1 year ago in reply to J Udaya Shanker
For millions of vehicles , third party liability Policy have been uniformly designed. Even comprehensive motor policy formats are few , with additions , extensions, special features They are sold regularly in the market, within acceptable degree of satisfaction for the vehicle owners.Why not for Health Insurance ?