Mumbai | June 25, 2021 6:05:33 am
While the country reported over 3.91 lakh deaths due to Covid-19 pandemic, only 14 per cent of them – 55,276 deaths – have made insurance claims so far, indicating the poor life insurance penetration in the country.
Out of 55,276 claims intimated to the insurance firms, nearly 88 per cent — 48,484 claims — amounting to Rs 3,593 crore have already been settled, said L Alamelu, Member (non-life), Insurance Regulatory and Development Authority of India (IRDAI). On the other hand, insurance companies have settled about 80 per cent — over 15.39 lakh – of health claims exceeding an amount of Rs 15,000 crore as on June 22. Over 19.11 lakh Covid health claims have been reported as on June 22 as far as medical insurance or hospitalisation is concerned, Alamelu said.
The repudiated claims for health cover are just about 4 per cent while in life it is just about 0.66 per cent, which is negligible, she said.
Alamelu said these figures showcase the opportunity available for insurers. “Now we are grappling with the problem that most of these people have spent a good amount of their savings. It has even taken many below the poverty line, they have gone into debts, sold their assets, pledged their jewellery and have been pushed back to the worst times,” she said while addressing an Assocham event.
She said both the insurance industry and the regulator have worked together to design new policies to cater to the demands of new and unprecedented situation. “We have also eased some processes and procedures to make it easier for servicing the policyholders,” Alamelu said.
The insurance industry grew extremely well to end the last financial year with combined life and non-life at a good nine per cent growth. During the April-May period of the current fiscal, growth of 17 per cent has been registered.
However, with Covid cases and deaths rising, insurance companies have of late turned cautious with some of them demanding vaccination certificates and stricter medical check-up.
Sajja Praveen Chowdary, Head- Term Insurance, Policybazaar.com, said, “Given the lack of clarity and uncertainty around after effects of Covid, getting a term life insurance policy might take a bit more time for those who have recovered from Covid. A term life insurance policy covers your life for a huge amount for a very small premium and in such policies underwriters across the world have been cautious for ages now in case of any medical condition that has occurred in the 6 months preceding the application for a policy.” Pre-Covid, the number of people who had any medical condition with themselves or family members in the past six months would have been small.
Given the way Covid cases have risen, this number has automatically moved up now because many have turned positive in the recent months. As a result, the proposal for term insurance gets into the zone of scrutiny where additional medical tests are asked for or might get postponed for three months. Over three crore people have been infected with Covid-19 virus so far.
According to Subhrajit Mukhopadhyay, Executive Director, Edelweiss Tokio Life Insurance, the industry has undergone significant transformation since the pandemic struck in March 2020, creating a strong momentum towards the end of the financial year. March and April 2021 have been a culmination of that momentum as the sector has been better positioned to meet the robust customer demand.
“Last year in March and April, the Covid 19 pandemic created a temporary lull as the world was shifting gears to adapt to an unprecedented event. The comparative effect from last year has also contributed to the strong business performance over the last two months. We might see a mild slowdown in May 2021 due to the second wave of the pandemic,” Mukhopadhyay said.
“And as people are getting wary of stepping out of their homes due to Covid, it is understandable from their perspective that they don’t wish to go out for medical tests or let someone come to their homes to collect samples. On the other hand, it becomes difficult for the insurance company to accept the risk and issue a policy without assessing the risk properly in the absence of fresh medical reports,” Chowdary said.
📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines
- The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.