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Amid surge, health insurance claims shoot to Rs 22,955 crore

However, insurance companies have settled only claims of 12.33 lakh customers for about Rs 11,794 crore so far, according to figures compiled by General Insurance Council.

Written by George Mathew
Mumbai | Updated: May 20, 2021 7:54:20 am
Covid-19A health worker checks a Covid patient on oxygen support at a hospital, during the second wave of the coronavirus pandemic in Bengaluru (PTI)

AMID THE second surge, with the number of infections rising rapidly across the country, claims made under health insurance for Covid have shot to Rs 22,955 crore with 14.82 lakh customers submitting hospital bills as on May 14.

However, insurance companies have settled only claims of 12.33 lakh customers for about Rs 11,794 crore so far, according to figures compiled by General Insurance Council. The claims of over 2.5 lakh customers involving Rs 11,161 crore are yet to be cleared, the figures show.

These are claims made by customers for Covid treatment under all insurance schemes, including two specifically for Covid, since April 2020.

Among states, Maharashtra leads with 5.35 lakh people submitting claims worth Rs 6,896 crore as of May 14, followed by Gujarat, Karnataka and Delhi (see chart). These five states account for 65 per cent of the total claims.

While the average Covid claim amount was Rs 154,808 as of March 2021, the average amount settled worked out to Rs 95,622 per person on an all-India basis. Among states, Telangana topped in amounts settled with a person getting Rs 125,260 for hospitalisation and treatment, followed by Delhi with Rs 121,540 per person.

With cases and claims spiking, complaints have emerged of some insurance companies refusing to renew or offer new Covid policies to customers, prompting the Insurance Regulatory and Development Authority of India (IRDAI) to step in.

“It has come to the notice of the Authority that some of the insurers are not offering Corona Kavach and Corona Rakshak Policies to the customers, and some insurers are not renewing such policies,” the IRDAI said in a letter to insurance companies.

“In the wake of rising infection rates due to the second wave of the Covid-19, the insurable public require appropriate health insurance coverage and it is not correct to deny such coverage to the customers in this crucial time,” it said.

All insurers are advised to ensure that wherever corona-specific standard products have been filed and approved by the Authority, it should be offered to the customers according to the insurer’s underwriting policy, it said.

“Similarly, where the underlying corona-specific product enables the insured to renew the policy as specified in the IRDAI circular, insurers are advised to renew such policies subject to the underwriting policy of respective insurers,” the Authority said.

Industry sources told The Indian Express that insurers have “seen a spurt in claims” under Covid policies.

“They don’t want to take a hit in their books. Some insurers, including public sector firms, have been refusing to offer policies to customers as the Covid pandemic flares,” they said.

Corona Kavach and Corona Rakshak were launched by insurers under IRDAI’s guidance. Corona Kavach is an affordable policy that covers medical expenses incurred on hospitalisation due to diagnosis of Covid. The cost of treatment towards any co-morbid condition, including those pre-existing, along with treatment for Covid, will be covered by the policy, according to the IRDAI.

State governments have also started fixing the rates of various medical items used for Covid treatment. The Kerala government recently fixed the rate for a PPE kit at Rs 273, N95 mask at Rs 22, oxygen mask at Rs 54, surgical gown at Rs 65, apron at Rs 12 and fingertip pulse oximeter at Rs 1,500.

The IRDAI has ruled out a steep hike in premium in health insurance policies despite a rapid rise in claims by policyholders. Meanwhile, total premium collection under the health insurance category by insurers amounted to Rs 58,572 crore as of March 2021, a rise of 13.3 per cent when compared to the last year.

New India Assurance collected Rs 10,736 crore followed by Star Health Insurance at Rs 9,204 crore, according to the Council’s data.

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