BackBest health plans for you
A key piece of buying any insurance policy is how good the company is in paying claims
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How do you buy a health insurance plan? If you just settle with the plan your agent sells or are happy knowing you have bought the cheapest plan, there is a bit of unlearning and a lot of learning in store for you. A health insurance policy packs in several features and caveats. To give you a ready comparison, we designed Mint Mediclaim Ratings (MMR), which was developed by SecureNow Insurance Broker Pvt. Ltd. The full ratings along with the methodology can be seen here: https://www.livemint.com/mintmediratings.
In the ratings, for family floater plans, we have considered two sum insured amounts ( ₹ 10 lakh and ₹ 20 lakh) and three age categories in each—eldest insured member is 35, 45 or 65 years old. For individual plans, the age categories are the same but the sum assured is ₹ 5 lakh. The newest edition of the ratings (July 2015) also includes individual plans of ₹ 5 lakh, ₹ 10 lakh and ₹ 20 lakh for a person aged 70 years.
This week, we spotlight family floater policies with sum assured ₹ 20 lakh, the eldest person being 65 years old and the coverage is for two adults.
We also explain some of the important aspects that one should look at while choosing a policy.
Let’s look at claims not settled. A key piece of buying any insurance policy is how good the company is in paying claims. Unfortunately, in India, in the health insurance space, this data is difficult to get in a user-friendly and comparable format. Claims settlement data in public disclosure documents is a consolidated set of numbers that includes claims from group and individual policies. But only a small number of group policies are rejected, so, if an insurer has a sizeable group portfolio, its claims settlement data may look healthier. Therefore, it is important to segregate this data for better analysis. But the Insurance Regulatory and Development Authority of India has not asked for it, nor have insurers done so. The second issue is in the nomenclature. Under claims settlement, insurers state number of claims reported, settled, repudiated, closed and outstanding. It’s important to track the claims payment of an insurer—claims paid over claim decisions taken (settled, repudiated and closed). The inverse of this measures the claims not settled. While claims repudiated and settled are self-explanatory, closed claims need some detailing. According to insurers, closed claims are those unpaid claims that are closed either due to lack of more documents from the insured or where the policyholder hasn’t pursued the claim further. Closed claims should ideally form a very small portion, but if it’s sizeable, there is reason to worry. In our ratings, we have put claims repudiated along with claims closed in the claims not settled basket. This is a start and perhaps will encourage the industry to publicly disclose data in a more transparent fashion.
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