Small business owners are realising that the Employees’ State Insurance Corporation (ESIC) programme under which they are covered is inadequate and are opting for commercial group cover.
Both Star Health & Allied Insurance MD S Prakash and SBI General Insurance head (product development) Subramanyam Brahmajosyula said that they are seeing 40-50% growth in SME business compared to last year.
Companies that have adopted the full work-from-home model get a relatively lower hike on premium as risk exposure is lower as well as the claims raised.
“On an average, we have recorded a 30% rise in the premium price of group health policies as compared to the previous year. On requests, we provide add-on covers where tele-medical consultations and elderly care are covered, against an additional premium. This also includes consultations for mental illnesses,” said Future Generali India Insurance chief operating officer Shreeraj Deshpande.
Insurtech company Vital’s co-founder Jayan Mathews said, “Since the pandemic outbreak, employees expect an inclusive and cost-effective group health policy which covers post-Covid effects — including counselling for mental health and wellness. There is an added pressure on employers to provide inclusive wellness care for employees who work from home.” Vital co-develops the insurance cover with Care Health Insurance and integrates with healthcare platforms for wellness benefits.
The rise in premium is because the second wave has made health insurance less profitable. The loss claim ratio for group health business stands above 100%, that is, 104-110% in June 2021, as against 90-95% in June 2020. The fresh demand is cushioning the price rise. “A high demand could lead to a minimum price revision of 12-17%, where it could go up to 30-40% if there is not much pickup in demand,” said Nilanjan Roy, who heads group business at ManipalCigna Health Insurance.
