The Hindu Business Line : Under loving cover

Sunita Kapoor, 72, has just renewed her Varishta Bima Yojana, a health insurance for senior citizens, for the second year. She is thanking her lucky stars that she took the insurance because when she was suddenly hospitalised some months later she didn’t have to worry about the high cost of the treatment. This, says Sunita, a widow, probably contributed more to her recovery than anything else.

In fact, the number of senior citizens taking this policy, the first of its kind in the country, has doubled in the last six months and is expected to further increase with the tax concessions announced in the recent Budget.

Introduced by the National Insurance Company (NIC) and launched by former President Abdul Kalam in December 2006, the Varishta policy has been specially designed for above 60 years. At present, standard medical policies are offered only up to the age of 60.

“VBY is for persons in the 60-80 age bracket and can be extended to 90 years on a renewal basis. Approximately 3,177 seniors have signed up in the last six months which is double the existing number. But we are expecting this number to rise with the recent tax benefits announced for those insuring their parents’ health,” says Subir Bhattacharyya, NIC.

Special features

The special feature of this policy is that the elderly who were covered under a health insurance for three continuous years prior to taking the VBY can switch over to this policy without any medical check-up and with continuity of benefits. Additionally, any ailment prior to taking the insurance, that is any pre-existing disease, would be covered after one claim-free year.

Several critical illnesses like cancer, renal failure (failure of both kidneys), stroke, multiple sclerosis and coronary artery surgery are also covered. It also encompasses major organ transplants like kidney, lung, pancreas and bone marrow, as well as paralysis and blindness for an extra premium.

Sunita was fortunate the VBY was available at a time when she needed it the most. Till a year ago, senior citizens had no option but to pay exorbitant medical bills if they were hospitalised. This is because the elderly have been denied health insurance as they are not considered a commercial proposition after the age of 60 years. Women — already victims of neglect and discrimination on account of gender, widowhood and age — have been affected the worst.

With women expected to constitute 51 per cent of the population of older persons of 100 million by the end of this decade, because of the increase in their life expectancy, health insurance is vital, says Mathew Cherian, chief executive, HelpAge India, a NGO working for the elderly.

Cover for all?

“Although we talk about health for all, the old — men and women — have never been a priority. Approximately all of them suffer from age-related ailments. The VBY gives them an option to seek medical assistance when they need it,” he says.

Sutasom Sen, the first person to sign up for VBY, was 75 when he took the policy. “I knew no other company would give me insurance at that age. I had insurance until I retired in 1991. Since I was always in good health I didn’t think it was needed after retirement. But after my children told me about this scheme, I realised I should not take my good health for granted,” says Sen.

Bhawarilal Sanei, 65, has both blood pressure and diabetes. He knew that he would always need some kind of medical treatment and is happy that he has a medical cover for another 25 years.

“Pre-existing diabetes and hypertension can be covered from inception on payment of additional premium at the rate of 10 per cent for either hypertension or diabetes and 20 per cent for hypertension and diabetes for first year of the policy. In addition, since elderly women are more likely to suffer from knee pain, knee replacement is also covered,” says Bhattacharyya.

Even while expressing satisfaction about certain features of VBY, most seniors feel the premium rates are steep. At present the rates for insurance of Rs 3 lakh (inclusive of critical illness) range between Rs 6,187 and Rs 9,178 for the age bands 60-65 and 76-80 years respectively.

Suggestions given to the Union Government earlier this month by a committee on senior citizens’ health insurance instituted by the Insurance Regulatory and Development Authority include recommendations for standardisation of premium rates instead of varying it according to age. It has also suggested formation of a health insurance pool to take care of claims of high-risk senior citizens, especially those above 80 years.

In a country where every six out of 10 elderly fall below the poverty line, it remains to be seen whether the Government finds the elderly important enough to accept these suggestions.

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