14 Mar 2008, 0028 hrs IST,Rucha Biju Chitrodia
Senior citizens continue to feel short-changed in their medical insurance dealings. The Insurance Regulatory and Development Authority of India (IRDA) had recently directed public sector insurance companies to cap the premium loading on policy renewals at 75% of the previous year's rates. Senior citizens, however, say this salvo was more in the form of an appeal than directive. They complain that instances of over 100% premium loading continue to be reported. Companies rationalise the sharp increase on grounds that these are just higher rates that one pays while moving to a higher age band, says K S (Kaka) Samant, general secretary at the general insurance pensioners' association (western zone). "They load the premiums in such a fashion that you have no choice but to opt out of the policy." Samant says Insurance Regulatory and Development Authority of India is supposed to put up all its circulars on its website. This particular circular, though, cannot be found anywhere on the site. "It was only a simple letter sent to CMDs of companies requesting them not to raise their premiums," he says. K N Bhandari, secretary-general at the general insurance council, too confirms, "It was not a direction. It was an advisory issued to some companies." However, IRDA chairman C S Rao insists that it was a circular, albeit issued only to the four public sector general insurance companies. Two of them, says the regulator, were asked to stick to the 75% limit while their products were being cleared. The remaining two have been told to bring it in line with the others. Senior citizens bring up another grouse—they rarely receive policy renewal letters from insurance companies. "In 90% of the cases, renewal letters have not been sent. Only agents who receive commissions do the needful," says Samant. An industry observer adds: "The insurance agent provides the last mile connectivity between the insurance company and the policy-holder. Some insurance companies have snapped this link by sharply reducing their commission levels." Samant points out that since older consumers may suffer from memory lapses, there are chances that they may forget to renew their policies. Such a slip may mean loss of benefits and maybe renewal altogether. Companies may reject a renewal proposal citing some "pre-existing illness" that might have crept in during the break. "It is obvious that health insurance is not profitable. Since it is human-centric, companies want to save as much as possible," says Samant. Bhandari, however, refutes this charge saying that it is in the companies' interest to invite renewal of cases, as cost of retention of the policy is lower than referring a new policy proposal. Interestingly, the companies face no compulsion to issue the renewal letters. The regulator says that an intimation letter for policy renewal is not mandatory. To top it, the industry observer says some insurance companies have issued unfavourable guidelines to their agents regarding senior citizens. They can bring in senior citizen proposals only if the applicant is known to them personally and they are also aware of her or his medical history. This discourages agents.
Friday, March 14, 2008
Wednesday, March 12, 2008
Did you know this?
General insurance companies are reducing the commission paid to insurance agents who sell health cover to people over 45 years of age. Some public sector general insurers have informed their agents that they would receive 15 per cent commission for health covers sold to individuals aged 45 years and below.
For those in the 45-55 age bracket, the commission is down to 10 per cent, while no commission will be paid where the individual has crossed 55 years.
This is bad news for those who are middle-aged and yet to take health insurance. Many agents have requested the Association of LIC Agents to take up the issue on their behalf.
They have also sent letters to the four public sector general insurers, the finance minister and the insurance regulator IRDA (Insurance Regulatory Development Authority).
Explains S S Bairagra, general secretary, ALICA, "People above 55 years are categorised as elderly. They would need an agent's services most, especially when there is a claim because a lot of running around will have to done. So, if no commission is paid, who will want to service them?" Simply put, no agent would want to spend effort to sell products to a customer or even service existing clients when there is no compensation provided.
For those in the 45-55 age bracket, the commission is down to 10 per cent, while no commission will be paid where the individual has crossed 55 years.
This is bad news for those who are middle-aged and yet to take health insurance. Many agents have requested the Association of LIC Agents to take up the issue on their behalf.
They have also sent letters to the four public sector general insurers, the finance minister and the insurance regulator IRDA (Insurance Regulatory Development Authority).
Explains S S Bairagra, general secretary, ALICA, "People above 55 years are categorised as elderly. They would need an agent's services most, especially when there is a claim because a lot of running around will have to done. So, if no commission is paid, who will want to service them?" Simply put, no agent would want to spend effort to sell products to a customer or even service existing clients when there is no compensation provided.
Russi Phiroze Daruvala,Mumbai,says:
Last year I paid a premium of rs.13740 (12242 serv.tax 1498) on a mediclaim policy covering myself(69years) and my wife(62 years) this year I am asked to pay rs.27577 (24543 serv.tax 3034)which is more than a 100% increase despite the directive of a maximum of 75% increase. Moreover, the Finance Minister should also seriously consider exempting Mediclaim policies of Senior Citizens from Service Tax which itself adds to the burden of Senior Citizens, as you can see from the additional amount I have to pay as service tax.
Insurers Charging Higher Renewal Premium from Senior Citizens Face IRDA Music
Economic Times ,February 7, 2008
Insurance Regulatory and Development Authority’s (IRDA) recent circular that said renewal premiums payable by senior citizens in 2008 cannot be hiked beyond 75% of the premiums paid in 2006 had come as a breather for elderly. Despite this, senior citizens are being asked to cough up tariffs that were increased by 100-200% in 2007, a month after the date of implementation of this circular.IRDA has decided to pull up errant insurers either on the basis of inspections or on the basis of specific complaints made by insured. Nevertheless, officials from the four public sector insurers at branch levels or for that matter in regional offices are unaware of any such circular and are continuing to charge the existing hiked tariffs. As a result, senior citizens are being asked to pay increased premiums for their existing policy.In fact, ET has received a few letters from senior citizens who were asked to dole out hefty premiums by insurers like Oriental Insurance, National Insurance while for others, policy renewal was flatly denied.Officials from New India Assurance, the largest public sector insurer in Kolkata, said: “We have not received any circular or directive from our head office. In the absence of any such intimation, we are charging the existing tariffs. The tariffs were revised last year and we are charging as per the schedule.” Those from Kolkata-based National Insurance said they were ignorant about any such developments or circular. “We are charging as per the latest revised chart,” they added. According to the revised charges, premiums have been raised by sizeable amounts for senior citizens.Officials at regional offices of United India Insurance, as well as Oriental Insurance, said they are yet to receive such a circular from their respective headquarters and have been charging as per this existing premium schedule.IRDA chairman CS Rao said that a circular to this effect has been sent to every insurer and they should have implemented it from January 2008. “We have asked insurers to charge at most 75% more on the premiums they paid in 2006 for senior citizens. Not on the hefty premiums they already paid in 2007,” IRDA chairman Rao told ET.Citing an example, he said: “If someone paid Rs 10,000 to renew his premium in 2006, he will pay at most Rs 17,500 in 2008. Premiums for the year 2008 will not be based on premiums already paid in 2007.” Since IRDA’s notification came towards the fag end of 2007, when almost all policies were renewed and seniors were forced to cough up those extra 100-200%, the regulator has decided to base the 75% cap on previous year’s premiums.
Insurance Regulatory and Development Authority’s (IRDA) recent circular that said renewal premiums payable by senior citizens in 2008 cannot be hiked beyond 75% of the premiums paid in 2006 had come as a breather for elderly. Despite this, senior citizens are being asked to cough up tariffs that were increased by 100-200% in 2007, a month after the date of implementation of this circular.IRDA has decided to pull up errant insurers either on the basis of inspections or on the basis of specific complaints made by insured. Nevertheless, officials from the four public sector insurers at branch levels or for that matter in regional offices are unaware of any such circular and are continuing to charge the existing hiked tariffs. As a result, senior citizens are being asked to pay increased premiums for their existing policy.In fact, ET has received a few letters from senior citizens who were asked to dole out hefty premiums by insurers like Oriental Insurance, National Insurance while for others, policy renewal was flatly denied.Officials from New India Assurance, the largest public sector insurer in Kolkata, said: “We have not received any circular or directive from our head office. In the absence of any such intimation, we are charging the existing tariffs. The tariffs were revised last year and we are charging as per the schedule.” Those from Kolkata-based National Insurance said they were ignorant about any such developments or circular. “We are charging as per the latest revised chart,” they added. According to the revised charges, premiums have been raised by sizeable amounts for senior citizens.Officials at regional offices of United India Insurance, as well as Oriental Insurance, said they are yet to receive such a circular from their respective headquarters and have been charging as per this existing premium schedule.IRDA chairman CS Rao said that a circular to this effect has been sent to every insurer and they should have implemented it from January 2008. “We have asked insurers to charge at most 75% more on the premiums they paid in 2006 for senior citizens. Not on the hefty premiums they already paid in 2007,” IRDA chairman Rao told ET.Citing an example, he said: “If someone paid Rs 10,000 to renew his premium in 2006, he will pay at most Rs 17,500 in 2008. Premiums for the year 2008 will not be based on premiums already paid in 2007.” Since IRDA’s notification came towards the fag end of 2007, when almost all policies were renewed and seniors were forced to cough up those extra 100-200%, the regulator has decided to base the 75% cap on previous year’s premiums.
Senior citizens with health insurance policy problems can post grievances on website
8 Feb, 2008, 0000 hrs IST, TNN
Senior citizens who have problems with their health insurance policies will soon have a platform to put forward their grievances. IRDA will soon launch a website exclusively to cater to the grievances of senior citizens with respect to health insurance. The launch of the website is a part of the recommendation of an IRDA committee for senior citizen’s health insurance. The website will be operational within a week and will have a senior IRDA officer in charge of the cell, exclusively addressing the issues raised by senior citizens on health insurance policies. Mr Rao said that the committee had made a number of recommendations, some of which will require Parliamentary approvals. Some are being examined by the regulator. While the website is among the short-term measures, suggested by the committee. Senior citizens were the worst affected by actions taken by insurance companies to curb losses in their health insurance portfolio. IRDA has been receiving a spate of complaints from senior citizens on health insurance. The complaints related to areas such as non-acceptance of proposals, doubling of premium rates, accepting only low sum insured and not sending renewal notices. Insurers have also been refusing to settle claims of senior citizens on ground that their ailments were pre-existing and the insurance was taken after the medical condition was detected. Following these complaints IRDA set up a committee IRDA) has formed a committee headed of KS Sastry, former chairman, National Housing Bank, to study how insurance companies could meet the need of senior citizens. Besides senior officials from the general insurance industry, the committee included representatvies from third party administrators and senior citizen's associations. Among other things the committee was asked to suggest commercially viable health schemes for senior citizens which will at the same time ensure that the cost of healthcare does not go up. Sometime ago the IRDA issued a directive to state-owned insurance companies asking them not to increase health insurance premium by more than 75%. This followed complaints by several senior citizens that their premium rates have doubled. However, despite this directive from the regulator companies have not rolled back the hike.
Senior citizens who have problems with their health insurance policies will soon have a platform to put forward their grievances. IRDA will soon launch a website exclusively to cater to the grievances of senior citizens with respect to health insurance. The launch of the website is a part of the recommendation of an IRDA committee for senior citizen’s health insurance. The website will be operational within a week and will have a senior IRDA officer in charge of the cell, exclusively addressing the issues raised by senior citizens on health insurance policies. Mr Rao said that the committee had made a number of recommendations, some of which will require Parliamentary approvals. Some are being examined by the regulator. While the website is among the short-term measures, suggested by the committee. Senior citizens were the worst affected by actions taken by insurance companies to curb losses in their health insurance portfolio. IRDA has been receiving a spate of complaints from senior citizens on health insurance. The complaints related to areas such as non-acceptance of proposals, doubling of premium rates, accepting only low sum insured and not sending renewal notices. Insurers have also been refusing to settle claims of senior citizens on ground that their ailments were pre-existing and the insurance was taken after the medical condition was detected. Following these complaints IRDA set up a committee IRDA) has formed a committee headed of KS Sastry, former chairman, National Housing Bank, to study how insurance companies could meet the need of senior citizens. Besides senior officials from the general insurance industry, the committee included representatvies from third party administrators and senior citizen's associations. Among other things the committee was asked to suggest commercially viable health schemes for senior citizens which will at the same time ensure that the cost of healthcare does not go up. Sometime ago the IRDA issued a directive to state-owned insurance companies asking them not to increase health insurance premium by more than 75%. This followed complaints by several senior citizens that their premium rates have doubled. However, despite this directive from the regulator companies have not rolled back the hike.
Monday, March 10, 2008
if disease doesn't get you, insurance will
is this too grim a view?
prohibitively high premiums . exclusions. rejections. impatient children. strange things happen when one's old. even with the so-called 'better off".
wish it weren't the case.
Since the private insurance won't tell us we suggest the elders share their experiences here. At the outset, let us tell you that none of us here are over 65 yet, not even close. We are just young researchers who are curious as to what is happening to our elderly, in their 'twilight years' . And also try to make a difference. All of us have parents waiting in homes far away. And invariably, most of us are trying/planning to get them insured.
Insurance companies consider the old to be 'bad risks', everyone knows it. But what we do not know is how they systematically exclude the old. Particularly in India, where the health insuance sector was opened up to private players in 2000. Even though the government is claiming that it will safeguard the interests of the aged, nobody knows what is happening on the ground. Or in posh offices of the insurance companies,rather. Your experiences would be really helpful.
prohibitively high premiums . exclusions. rejections. impatient children. strange things happen when one's old. even with the so-called 'better off".
wish it weren't the case.
Since the private insurance won't tell us we suggest the elders share their experiences here. At the outset, let us tell you that none of us here are over 65 yet, not even close. We are just young researchers who are curious as to what is happening to our elderly, in their 'twilight years' . And also try to make a difference. All of us have parents waiting in homes far away. And invariably, most of us are trying/planning to get them insured.
Insurance companies consider the old to be 'bad risks', everyone knows it. But what we do not know is how they systematically exclude the old. Particularly in India, where the health insuance sector was opened up to private players in 2000. Even though the government is claiming that it will safeguard the interests of the aged, nobody knows what is happening on the ground. Or in posh offices of the insurance companies,rather. Your experiences would be really helpful.
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