Money & Banking

Coronavirus: Insurers offerings focussed on fixed benefit covers on health side

KR Srivats New Delhi | Updated on March 17, 2020 Published on March 17, 2020

Indian general insurers are not able to provide sophisticated cover for business disruptions, including loss of revenue, due to the coronavirus pandemic playing out in the country.

However, they are in a position to provide cover on the health side, both out-patient and hospitalisation, besides expenses related to diagnostics tests, doctor consultations, pre and post-hospitalisation expenses and ambulance expenses, say industry players that BusinessLine spoke to.

Difficult to offer cover

General insurers said it is difficult to offer cover for loss of income to traders on account of coronavirus although it is now declared as a pandemic by WHO and India has invoked both Epidemic Act and National Disaster Management Act (NDMA).

Even companies in India that had suffered from supply chain disruptions arising from overseas markets cannot get compensation in India. “In India, there are no sophisticated covers available for non-damage business disruptions. You don’t get cover for business interruptions unless you show loss of property,” Sanjay Datta, Chief Underwriting, Claims and Reinsurance, ICICI Lombard, told BusinessLine.

Also, as such, there are no specific insurance products that cover economic downturns.

There are no products/ covers available in India for ‘loss of income’ situations linked to shutdown arising from global events such as the coronavirus outbreak in China and the developed world, they added.

Coronavirus product

Meanwhile, ICICI Lombard General Insurance, a private general insurer, plans to come out with a coronavirus product that will provide small benefit coverages on the health side, said a top official. This will be little more than a sachet product and will provide a limited amount of compensation to a person who is diagnosed with coronavirus, said Datta.

“We are looking to provide a specific product for coronavirus. It will be only one product and we will take IRDAI approval. It will only be for health part and not provide cover for loss of income as some traders are looking for,” he said.

Datta highlighted that ICICI Lombard’s health insurance products already cover hospitalisation related to coronavirus attack.

One of the interesting features of ICICI Lombard General Insurance’s proposed product is that the company will provide compensation no matter whichever infected area the insured had been to, according to Datta.

This would be interesting as one of the coronavirus-specific product available in the market now stipulates that cover will not be applicable if the insured person were to travel to specified countries during the policy period or to these countries post December 1, 2019. The countries specified are China, Japan, Singapore, South Korea, Thailand, Malaysia, Hong Kong, Macau, Taiwan, Italy, Iran, Kuwait and Bahrain.

Digit Insurance had recently provided a fixed benefit cover for coronavirus under the sandbox product approval of ‘need-based insurance’ under the IRDAI Regulatory Sandbox Regulations 2019.

If the test for Coronavirus Disease (COVID-19) is found positive from any of the authorised centres of ICMR – National Institute of Virology, Pune – then Digit Insurance promises to give 100 per cent of the Sum Insured. There is no need to wait for the completion of treatment.

For those quarantined in a Government or Military hospital for atleast 14 consecutive days will get 50 per cent lumpsum of the sum insured. This is applicable even if COVID-19 is later negative as it covers the screening and treatment costs.

Asked about insurance for Covid-19, Biresh Giri, Appointed Actuary, Head of Product Development and CRO, Acko General Insurance, said that increased travel across the world facilitates free exchanges of deadly virus resulting in highly communicable and infectious diseases. It has become essential to have an adequate safeguard covering specialised medical treatment, he said.

“Our Health insurance plans cover such virus outbreak. The symptoms of coronavirus infection are similar to that of the common cold and typically affect the upper respiratory body, as new diseases like coronavirus will not fall under pre-existing illness thus eliminating a waiting period associated with it. Our plan(s) cover out-patient and hospitalisation expenses resulting from coronavirus /COVID19 covering expenses related to diagnostics tests, OPD doctor consultations, hospitalisation, pre and post-hospitalization expense and ambulance expenses”.

Published on March 17, 2020
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