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Saturday, August 3, 2013

New India rolls out Mediclaim Policy covering 'Diabetes ~ hypertension'.....

Medical policies are taken to cover against illness / diseases and resultant hospitalization. The policy excludes some diseases / ailments – while there is waiting period for specified diseases [in general and does not purport to represent any specific insurance policy of any Insurer]

When diseases / ailments / conditions are shown under ‘waiting period’ – those excluded will be deleted [meaning will come under purview of coverage] once the duration so specified is over, provided of course, the policy is continuously renewed with the Insurer without any break.  Some of the exclusions are – skin disorder, Cataract, Diabetes mellitus, Gastric / Duodenal Ulcer, Hernia, Pilonidal Sinus, Sinusitis and related disorders, stones in Gail bladder and bile duct ……..…

A recent news item in TOI titled - A 'premium' relief for diabetes, hypertension patients makes an interesting read.  Here is some extract of the enws that appeared on 1st Aug 2013.

New India Assurance — India's largest non-life insurer — has decided to stop charging additional premium for those with diabetes and hypertension under its revised health insurance policy. The state-owned insurer has also withdrawn a clause from its policy that excluded cover for ailments caused by tobacco consumption. The move will come as a relief to a significant chunk of India's urban population and will also eliminate disputes arising out of wrongful rejection of claims. The company has decided to include tobacco-related ailments because the exclusion was causing hardship to a lot of policyholders and also because it amounted to rejection of claims on account of lifestyle. The new health insurance policy, however, continues to exclude cirrhosis of lever caused by alcoholism.

"Under the new policy there will be no difference in rates for a standard proposal and someone with diabetes or hypertension," said G. Srinivasan, chairman, New India Assurance. He said that one of the reasons for the decision was the high incidence of people with such conditions. However, the earlier practice of having a four-year cooling period for pre-existing conditions will continue. This means that if a diabetic buys a policy, the coverage for diabetes related hospitalisation will begin only after four years. The new 2013 mediclaim policy now allows health insurance up to Rs 8 lakh as against Rs 5 lakh earlier. "Senior citizens will also be given a one-time option to increase their sum insured if they have had two claim free years," said Segar Sampathkumar, head of health insurance at New India Assurance.

The new policy has come into effect from July for new sales and all renewals from August 2013 will be under the new terms. ToI had earlier reported on the increase in health insurance charges by all the state-owned insurance companies from the current fiscal. Following the revision prices have gone up by on an average around 23%. According to Srinivasan, the measures are also aimed at reducing disputes in health insurance. As part of its move to settle claims early, New India has decided to set up an independent panel comprising of a retired insurance official and outsiders who refer complaints to health professionals and take a call.

The details of the new policy were provided by Srinivasan while announcing the company's first quarter results. As against a loss of Rs 486 crore in the first quarter of FY14 the company has reported a profit of Rs 262 crore in the first quarter of FY13. Part of the reason for the turnaround has been the increase in motor third-party rates. New India has also decided to start selling third-party motor insurance cover online. This will be a big relief for owners of older vehicles since insurance agents do not offer their services for buying standalone third-party insurance on which there is no commission.

Zee carried an extract of interview with Mr Sekar Sampath, GM and Transparency Officer

Q : Why the sudden reduction in the premium amount?

A : We felt that it was causing a lot of trouble for our customers. Take this example, suppose there is a person A who has applied for a policy in the year 2007 and he/she did not have either diabetes or hypertension while applying for the policy. He/she gets a health insurance policy that covers all medical bills. Another person B, suffers from diabetes while applying for the policy and discloses it. The company provides him/her with a policy that excludes cover for four years along with an extra charge added to his/her premium. Now A is diagnosed with diabetes in the year 2008, and he/she gets treatment for it, and asks the insurance company to pay for the expenditure of medicines to treat diabetes. This leaves B feeling like they have not been given a fair deal since he/she does not get the same benefits as A only because he/she had the disease before A. And A feels that since he/she contracted the disease after buying the policy, He/she should be covered appropriately. What would be the right thing to do?

That is why we were left with a dilemma and it was both cumbersome to the company as well as the patient. Therefore we decided that we should scrap the entire addition to the premium. It is also a move to simplify the entire process of identifying false claims.

Q: This news has spread like wild fire, are you the only company that is providing this subsidy?

A: Yes, as per my knowledge we are the first company who has done this. No other company in both the government and private sector has granted such a subsidy.

Q: But, it says that the health policy will still retain the four year waiting period before the insured can use the policy, is this best plan to help the ailing?

A: As for the 4 year waiting period. Diabetes is a lifelong chronic condition. If managed appropriately there is no risk of additional exposure (patient usually does not have a change in his or her status). We do give 50% costs of the medical care from the 2nd year and 75% of the costs from the third year. In the new policy this provision will not be available. We will cover preexisting conditions only after 4 years of waiting period. view:  Apart from cutting down on the premium the company has also decided to cover diseases arising from smoking, but does not cover liver cirrhosis which is usually caused due to alcoholism. While the subsidy is definitely something that most people want, will the changes go down well with their consumers?

As additional info, may add that in New India’s  senior citizen policy covers some pre-existing conditions [of Diabetes mellitus and Hypertension] from inception of the policy but will have to be declared at the time of taking out the policy and upon payment of additional premium.  However, any ailment attributable to Diabetes mellitus or Hypertension, which has already manifested at the time of inception of insurance, will not be covered even on payment of additional premium for covering Diabetes mellitus and/or  hypertension.

With regards – S. Sampathkumar
3rd Aug 2013

Source : TOI, Zee and New India website.

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