MUMBAI: Regulator Irdai‘s decision to cut the waiting period for pre-existing diseases in health insurance from four years to three, starting from April 2024 will push up health insurance premiums, SBI General Insurance‘s chief business officer Rakesh Kaul said.
The non-life arm of the country’s largest bank said that it has not decided how much of the increased cost will be passed on to the policyholder yet.Kaul told TOI that the reduction in the waiting period would increase the costs by 10-20 per cent, however, the company has not taken a decision on passing the cost of the increased risk to the customer.
“Medical inflation is 7-8%. Our approach is not to revise every year but to wait for three years before reviewing the rates,” said Kaul. Irdai, in its health insurance guidelines effective April 2024, said that insurers cannot reject any claim on the grounds of pre-existence of ailment three years after the issue of policy.
According to Kaul, the pricing of the product is not going to hit demand. “Health is not a price seeker market it is a value seeker market. It is our ability to customise and bring products to market. Unlike motor insurance, where the covers are pretty much standardised, health has lot of scope for customisation,” he said.
SBI General Insurance is looking to launch a slew of new products every quarter. On the anvil is a health plan where the customer can ‘drag and drop’ do-it-yourself covers to the policy based on the environment. The company is also coming up with a super top-up health cover.
The company’s focus is now on increasing the share of its individual health insurance business. “We have set up a strategic business unit for handling health insurance underwriting and claims in Pune and are now servicing most of our individual claims in-house,” said Kaul. He added that SBI General has the largest network of private hospitals with which it has service level agreements.
Kaul said that growth drivers will be the ability to innovate and customize products for segments based on each distribution channel. This has been made possible because of the insurers new technology platform. “We have put in place a partner engagement too Simba which empowers the distributor to customize products on their own”
The non-life arm of the country’s largest bank said that it has not decided how much of the increased cost will be passed on to the policyholder yet.Kaul told TOI that the reduction in the waiting period would increase the costs by 10-20 per cent, however, the company has not taken a decision on passing the cost of the increased risk to the customer.
“Medical inflation is 7-8%. Our approach is not to revise every year but to wait for three years before reviewing the rates,” said Kaul. Irdai, in its health insurance guidelines effective April 2024, said that insurers cannot reject any claim on the grounds of pre-existence of ailment three years after the issue of policy.
According to Kaul, the pricing of the product is not going to hit demand. “Health is not a price seeker market it is a value seeker market. It is our ability to customise and bring products to market. Unlike motor insurance, where the covers are pretty much standardised, health has lot of scope for customisation,” he said.
SBI General Insurance is looking to launch a slew of new products every quarter. On the anvil is a health plan where the customer can ‘drag and drop’ do-it-yourself covers to the policy based on the environment. The company is also coming up with a super top-up health cover.
The company’s focus is now on increasing the share of its individual health insurance business. “We have set up a strategic business unit for handling health insurance underwriting and claims in Pune and are now servicing most of our individual claims in-house,” said Kaul. He added that SBI General has the largest network of private hospitals with which it has service level agreements.
Kaul said that growth drivers will be the ability to innovate and customize products for segments based on each distribution channel. This has been made possible because of the insurers new technology platform. “We have put in place a partner engagement too Simba which empowers the distributor to customize products on their own”
