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Wednesday, April 21, 2021

Insurers settle 54% of Covid claims, 1.41 lakh cases still hanging

Of total claims of Rs 14,680 crore under the Covid health insurance schemes, insurers have settled only claims worth Rs 7,900 crore, which is 54 per cent of amount claimed by insured people.

Written by George Mathew
Mumbai | Updated: April 9, 2021 11:12:57 am
On top of this, while 9,96,804 people made claims as of March 2021, insurers have only settled the claims of 8,55,250 people, leaving out 1,41,554 people who are yet to get the money from insurance companies, according to figures available with the General Insurance Council.

At a time when the country is witnessing the second wave of the Covid pandemic, insurance companies have settled only 54 per cent of the claims received from the customers who have taken Covid health insurance as of March 2021. Of total claims of Rs 14,680 crore under the Covid health insurance schemes, insurers have settled only claims worth Rs 7,900 crore, which is 54 per cent of amount claimed by insured people.

On top of this, while 9,96,804 people made claims as of March 2021, insurers have only settled the claims of 8,55,250 people, leaving out 1,41,554 people who are yet to get the money from insurance companies, according to figures available with the General Insurance Council. This delay is despite insurance regulator Irdai advising all general and health insurers to decide on settlement of health insurance policies pertaining to Covid-19 within two hours.

“A major chunk of the insurance claims is cashless and settled by the insurance company on the day the patient is discharged. If 1.41 lakh patients whose claims are yet to get the money from the insurance company, that’s something that insurance regulator Irdai should look into and issue an advisory,” said an insurance sector official. A common complaint from customers is that insurers drastically cut down the claim amount on some flimsy reasons and many of them, including public sector firms, refuse to reimburse money to policyholders. However, insurers said many claims are inflated bills, which don’t come under the terms and conditions of the policy.

As many as 66.37 per cent of total claims under the Covid health insurance policies are from five states, with Maharashtra accounting for the maximum number of claims. Of total claims of Rs 14,680 crore under the Covid health insurance schemes as on March 31, 2021, claims worth Rs 9,744 crore have come from Maharashtra, Gujarat, Karnataka, Tamil Nadu and Delhi. Maharashtra topped the claims list with 3.58 lakh claims for Rs 4,345.39 crore, followed by Gujarat (1.30 lakh claims for Rs 1,922 crore) and Karnataka (75,938 claims for 1,136 crore).

Decisions on cashless treatment will have to be communicated to the hospital within two hours from the time of the receipt of authorisation request and the last necessary requirement. However, figures reveal that a good number of customers are yet to get the money from insurers despite the advisory of Irdai about reimbursement in two hours.

During the 11 months ended February 2021, insurance firms reported a 13 per cent increase in health insurance premium income to Rs 52,886 crore. Of this, retail customers accounted for Rs 22,909 crore and group policies amounted to Rs 25,540 crore.

The insurance regulator had, on March 20, said general and health insurance companies cannot reject claims based on “presumptions and conjectures” and have to specify the reason for denial or rejection of claims by referring to the corresponding policy conditions. In a circular addressed to the insurers, the regulator said, “Claims shall be processed in a transparent, seamless and efficient manner within the prescribed timelines.”

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