New India plans annual hikes for health insurance premiums
New India Assurance, having surged 50% in the past five trading sessions, has opted for an annual revision of health insurance premiums, moving away from the previous practice of increasing tariffs every three years.
Shares of New India Assurance gained 10% in Thursday's session to Rs 255.85 on the Bombay Stock Exchange, when the index rose 0.13%.
After a 25-30% increase in retail health insurance premiums in June, the first in six years, the company, initially slated for revisions in 2020 after a three-year gap, deferred its decision due to the pandemic. Neerja Kapur, chairman and managing director of New India Assurance, told analysts that the insurer is looking to ease the impact on policyholders by implementing smaller, annual increases rather than a substantial adjustment once every three years.
Kapur said the increase in premium is due to a spike in medical inflation and health claims frequency.
She said that health claims frequency has gone up due to Covid complications.
«When we increase health insurance premiums by 25-30%, we feel for our policyholders when they come back to us and complain about it,» Kapur said. «We are staggering it over every year and rather than doing a huge increase once in three years, we will be increasing by smaller amounts every year.»
Medical inflation has gone up by 12-13%.
To check health insurance premiums, New India Assurance, along with other public sector insurers, has established a preferred provider network with 4,000 hospitals, with special package rates. The insurer is also working on increasing empanelment.
Read more on economictimes.indiatimes.com
