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As cases surge, Covid health claims jump 240 per cent over a month

While there have been over 37,000 Covid deaths so far, Life Insurance Corporation (LIC), the nation's largest life insurer, has only seen 561 Covid death claims, amounting to Rs 26.74 crore.

Written by George Mathew | Mumbai | Updated: August 3, 2020 7:25:23 am
As cases surge, Covid health claims jump 240 per cent over a month There have been over 37,000 Covid deaths so far.

AS Covid-19 cases climb steadily across the country, touching 17.50 lakh on August 1, general insurance companies, including standalone health insurers, have reported an over 240 per cent jump in claims for treatment for the disease over the previous month.

As of July last week, 71,423 people had claimed Rs 1,145.87 crore from insurance companies towards Covid treatment, according to figures compiled by the General Insurance Council, the apex body of all general insurers. On June 22, only 20,965 people had made claims for Rs 323 crore.

 Despite this jump in insurance claims, in a sign of the low insurance penetration in the country, the health insurance claims received so far amount to just 4.08 per cent of the total number of people infected with the virus so far (17.5 lakh cases as on August 1). The average claim per person works out to Rs 1.60 lakh.

While there have been over 37,000 Covid deaths so far, Life Insurance Corporation (LIC), the nation’s largest life insurer, has only seen 561 Covid death claims, amounting to Rs 26.74 crore.

“LIC has always been proactive in settling death claims… Death claims arising due to Covid-19 are treated on a par with other causes of death and payments are being made on an urgent basis,” LIC said in a statement last Friday.

The average size of health cover across the industry is around Rs 2 lakh. Since in the case of Covid, the entire family is at risk, in a lot of cases, the health insurance cover is usually inadequate to cover the cost of treatment.

Read | Covid-19: 15 deaths reported in Delhi on Sunday, least in weeks

“Insurers are tracking the frequency and severity of Covid-19. Over time, the severity has come down but the frequency is on the rise. Fatality is another parameter to watch for… If there is no vaccine or if it takes long to be developed, there would be a requirement to increase the premium,” said Gopal V Kumar, consulting actuary, Radgo & Company.

While the 71,423 claims relate to health insurance policies sold by general insurance or health insurance companies, sources say they also include claims relating to Ayushman Bharat, especially in states that have roped in general insurance companies for the scheme.

Under the Ayushman scheme, the beneficiary family is entitled to a cover of up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation. Even Covid-19 testing and treatment are to be free for beneficiaries.

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