The Indian operations of the US-based financial services giant American Insurance Group (AIG) are sound and so is the case with domestic banks, Finance Minister P. Chidambaram said in New Delhi on Thursday, against the backdrop of the current global financial crisis.
Addressing reporters after a cabinet meeting chaired by Prime Minister Manmohan Singh, the finance minister said while the government was closely watching the global financial markets, the Indian banking system remained strong.
He specifically spoke about AIG's life and non-life insurance businesses in India in a 26:74 ratio with the Tatas and said there was no cause for worry - an opinion shared by the Insurance Regulatory and Development Authority (IRDA).
“Don't compare AIG with Lehman Brothers,” Chidambaram said.
He was referring to the largest bankruptcy filing in the US history by Lehman Brothers, as opposed to funds sought by the AIG to remain afloat, which the US central bank agreed to with $85-billion bridge loan. For full story read AIG's India operations.....
Thursday, September 18, 2008
Wednesday, September 10, 2008
Tier -2 cities to be TPAs target for health insurance growth
Touted as a vast untapped market for health insurance growth, the tier – cities have become a hot area for the TPAs. Third Party Administrators or TPAs as they are popularly called are organizations, which specialize in processing of insurance claims for various health insurance providers.
Around 10 – 15 branches comprise an average size branch network of a TPA in India. Most of the branches are located in metro cities or state capitals leaving a large uncovered area in rural areas and small towns. In contrast, the general insurance companies, which control nearly entire health insurance product, portfolio, are present in an average of 400 locations.
The government sponsored health insurance schemes like the Rashtriya Swasthya Bima Yojana (RSBY) have put a tremendous pressure on TPAs to deliver in the tier-2 cities and remote areas of the country.
MediaAssist, one of the major TPA players in the country has ambitious plans to expand into tier-2 cities. It is planning to increase the number of centers and the employed workforce to cater to the vast number of people covered by various government-sponsored health insurance schemes.
Saturday, September 6, 2008
HDFC enters health insurance with critical care
Private sector life insurance major HDFC Standard Life, has decided to enter into health insurance market with its product – HDFC Critical Care.
This flagship product is expected to provide an insurance cover against 30 critical illnesses. A person can get himself covered for a minimum sum assured of Rs. 2 lakhs and a maximum sum assured of Rs 20-lakhs.
This health insurance product will provide a lump sum benefit payment irrespective of actual medical cost, flexible premium payment option and a benefit payable on survival for a period of 30 days post diagnosis of the critical illness..
The maximum term available for the cover is 20 years, while the minimum tenure is five years. The minimum and maximum age at entry is 18 and 55 years respectively.
The maximum age at expiry of the policy can be 65 years.
This critical illness policy comes with a unique feature, where if a person is diagnosed with a set of critical illness categorized as ‘Group B’, he/she can get a premium waiver option. Under such a situation, 50 per cent of the sum assured would be paid in case of a valid claim and post the claim all further premiums would be borne by HDFC Standard Life and the policy would continue, the release said.
Critical health insurance being the first such product, the company also plans to launch other health care products like surgical care and hospital cash in near future.
“Our entry into health insurance market is a significant move in line with our business objective. The low penetration of health insurance in India gives us a tremendous opportunity to provide quality health insurance,” HDFC Standard Life's Managing Director & CEO, Deepak Satwalekar, said.
This flagship product is expected to provide an insurance cover against 30 critical illnesses. A person can get himself covered for a minimum sum assured of Rs. 2 lakhs and a maximum sum assured of Rs 20-lakhs.
This health insurance product will provide a lump sum benefit payment irrespective of actual medical cost, flexible premium payment option and a benefit payable on survival for a period of 30 days post diagnosis of the critical illness..
The maximum term available for the cover is 20 years, while the minimum tenure is five years. The minimum and maximum age at entry is 18 and 55 years respectively.
The maximum age at expiry of the policy can be 65 years.
This critical illness policy comes with a unique feature, where if a person is diagnosed with a set of critical illness categorized as ‘Group B’, he/she can get a premium waiver option. Under such a situation, 50 per cent of the sum assured would be paid in case of a valid claim and post the claim all further premiums would be borne by HDFC Standard Life and the policy would continue, the release said.
Critical health insurance being the first such product, the company also plans to launch other health care products like surgical care and hospital cash in near future.
“Our entry into health insurance market is a significant move in line with our business objective. The low penetration of health insurance in India gives us a tremendous opportunity to provide quality health insurance,” HDFC Standard Life's Managing Director & CEO, Deepak Satwalekar, said.
Health Insurance: Max India & UK Based BUPA Tie up
Max India one of the leading private insurance-provider has joined hands with UK-based Bupa to set up a standalone health insurance company.
British United Provident Fund (Bupa) the JV partner will hold 26 per cent of the stake in the company which will be called as Max Bupa Health Insurance Ltd. Rest of the company will be held by Max.
Max India Chairman Mr Analjit Singh said, “The initial share capital of the JV will be Rs 100 crore and the business are expected to be up and running in 12-15 months. However, Bupa will have an option and right to go up to maximum amount of FDI allowed by the government in case FDI reforms take place.”
Max, an expert in health care facilities has a customer base of around 2.7 million and operates specialty hospitals around the country. According to the Chairman, the products will be rolled out in phased manner and region wise. “We are not in a hurry to launch (the joint venture) immediately. We want to have ground preparation first which will take at least 12-15 months,” he added.
Broad range of products like individual, retail and group insurance will be targeted by the joint venture and the company plans to cover one million individuals as its customer base.
“The country has a huge potential for health insurance as the average age is expected to be 29 years in the next 12 years with people getting more spending power,” said, Anuroop Singh, Director Max India.
British United Provident Fund (Bupa) the JV partner will hold 26 per cent of the stake in the company which will be called as Max Bupa Health Insurance Ltd. Rest of the company will be held by Max.
Max India Chairman Mr Analjit Singh said, “The initial share capital of the JV will be Rs 100 crore and the business are expected to be up and running in 12-15 months. However, Bupa will have an option and right to go up to maximum amount of FDI allowed by the government in case FDI reforms take place.”
Max, an expert in health care facilities has a customer base of around 2.7 million and operates specialty hospitals around the country. According to the Chairman, the products will be rolled out in phased manner and region wise. “We are not in a hurry to launch (the joint venture) immediately. We want to have ground preparation first which will take at least 12-15 months,” he added.
Broad range of products like individual, retail and group insurance will be targeted by the joint venture and the company plans to cover one million individuals as its customer base.
“The country has a huge potential for health insurance as the average age is expected to be 29 years in the next 12 years with people getting more spending power,” said, Anuroop Singh, Director Max India.
Wednesday, September 3, 2008
Insurers see retail health plans as next big thing
Managed healthcare may still be a far cry, although health insurance premium has swelled to around Rs 5,000 crore.
Insurance biggies are now betting on big retail business in health, with the large private players coming up with new plans and innovative distribution channels to tap this promising segment.
With medical inflation estimated to be around 15-17%, the awareness needs to be built up urgently is the common refrain. The scope of the health care market is said to be around Rs 60,000 crore but the share of insurance is at present less than 1%.
Moreover, over 80% of the market is indemnity driven and is largely covered by mediclaim.
New business premium from health plans offered by life companies is still small at less than
Rs 100 crore and has a long way to go said life insurance officials. Out of the total premium garnered at present, retail is just about a share of 50% while the balance is from group plans.
Binay Agarwala, senior vice-president, health business and corporate strategy, ICICI Prudential Life, told DNA Money, “We feel that life companies have a huge retail presence, which will extend to health products as well. Health insurance is slightly different from pure life insurance. It is necessary to understand health insurance risks separately and price it.”
“We train our distribution forces differently as the pitch for health products is different from a life insurance product. Currently we have five core products and will look into variants in future.
It is a big challenge to create awareness and understanding of the need of health insurance products”, said Agarwala.
Some of the earlier life entrants into the health space are Tata AIG Life, ICICI Prudential and Bajaj Allianz, Reliance Life. Max New York Life, which, came up with a slew of health products, also proposes to tap the retail segment.
For Bajaj Allianz Life, health is one of its key verticals and the company expects to do Rs 120 crore of premium in the current year from the products that it has at present. It will be looking at various new products on women and children in the coming months.
Ujjaini Dasgupta, head, health insurance, Bajaj Allianz Life said, “Essentially standard mediclaim products are different from pure health plans with a life insurance element but with time and innovative products, customers will have a wide choice definitely”.
SBI Life Insurance CEO, U S Roy said, “There is a big segment and we propose to come in with innovative products in health”.
An Asian healthcare study by Credit Suisse that the private sector accounts for 80% of the healthcare expenditure with 64% being out of pocket and public health expenditure in India is among the lowest in the world at around 1% of the GDP.
Insurance biggies are now betting on big retail business in health, with the large private players coming up with new plans and innovative distribution channels to tap this promising segment.
With medical inflation estimated to be around 15-17%, the awareness needs to be built up urgently is the common refrain. The scope of the health care market is said to be around Rs 60,000 crore but the share of insurance is at present less than 1%.
Moreover, over 80% of the market is indemnity driven and is largely covered by mediclaim.
New business premium from health plans offered by life companies is still small at less than
Rs 100 crore and has a long way to go said life insurance officials. Out of the total premium garnered at present, retail is just about a share of 50% while the balance is from group plans.
Binay Agarwala, senior vice-president, health business and corporate strategy, ICICI Prudential Life, told DNA Money, “We feel that life companies have a huge retail presence, which will extend to health products as well. Health insurance is slightly different from pure life insurance. It is necessary to understand health insurance risks separately and price it.”
“We train our distribution forces differently as the pitch for health products is different from a life insurance product. Currently we have five core products and will look into variants in future.
It is a big challenge to create awareness and understanding of the need of health insurance products”, said Agarwala.
Some of the earlier life entrants into the health space are Tata AIG Life, ICICI Prudential and Bajaj Allianz, Reliance Life. Max New York Life, which, came up with a slew of health products, also proposes to tap the retail segment.
For Bajaj Allianz Life, health is one of its key verticals and the company expects to do Rs 120 crore of premium in the current year from the products that it has at present. It will be looking at various new products on women and children in the coming months.
Ujjaini Dasgupta, head, health insurance, Bajaj Allianz Life said, “Essentially standard mediclaim products are different from pure health plans with a life insurance element but with time and innovative products, customers will have a wide choice definitely”.
SBI Life Insurance CEO, U S Roy said, “There is a big segment and we propose to come in with innovative products in health”.
An Asian healthcare study by Credit Suisse that the private sector accounts for 80% of the healthcare expenditure with 64% being out of pocket and public health expenditure in India is among the lowest in the world at around 1% of the GDP.
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