Covid cover: Insurers sound caution as claims rise

G Naga Sridhar | | Updated on: Jun 21, 2022

Advise against unwarranted costly therapies, diagnostic tests

After a lull, there is once again an increase in claims related to Covid in the wake of increasing cases, according to insurers. Major general insurers and standalone health cover providers have been witnessing an increase in the number of claims.

“We are watching the scenario carefully. Instead of roughly 10 claims per day a couple of months ago, there are about 50 to 60 these days,” S Prakash, Managing Director, Start Health and Allied Insurance Company, told BusinessLine.

We are advising policyholders not to take unnecessary and expensive treatments such as cocktail therapies and CT scans in panic without proper advice. Hospitalisations are very few in the the fourth wave, compared to the previous ones,’‘ said Prakash, who is also a medical doctor. 

According to industry data, 98 per cent of Covid claims originate from general health insurance policies, and only two per cent are Covid-specific policies such as Carona Kavach.

“There has been a spurt in the intention to take insurance after the terrible second wave of the pandemic in India. The severity of the third wave was relatively less and hospitalisation claims had decreased. We see a similar trend in the fourth wave,’‘ said the head of underwriting at a major general insurer. 

“But we are concerned as the government machinery has not fully woken up. Booster doses should begin in the public distribution programme immediately,’‘ he added. 

Unwarranted and costly therapies could lead to an escalation in treatment costs and claims, leading to higher premiums, which will push customers and insurers into a ‘vicious circle’ , according to insurers.

The total number of Covid cases climbed to 4,33,19,396 on Tuesday, with the addition of 9,923 fresh cases, according to data released by the Health Ministry. The number of active cases increased to 79,313. The death toll increased to 5,24,890 with 17 deaths.

The demand for health cover has been increasing, say insurers. “In the last two years, awareness about health insurance has increased considerably, and the industry foresees a steady spike in the coming years,’‘ said Shreeraj Deshpande, Head – Health Businesses, SBI General Insurance.

“We have also seen an uptick in health insurance policy renewals. The pandemic has impacted the urban and rural sectors and drawn attention to the need forcustomised products that meet customer requirements,’‘ he added. 

Published on June 21, 2022
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