Lok Sabha Question No. 2958 (UNSTARRED), answered on 2016-12-02
Subject: Health Insurance
Ministry: FINANCE
Asked by: CHINTAMAN NAVSHA WANAGA, HEMANT TUKARAM GODSE

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION NO. 2958

TO BE ANSWERED ON 2 nd  December, 2016 / Agrahayana 11, 1938 (Saka)

Health Insurance

## 2958. ADV. CHINTAMAN NAVASHA WANAGA: SHRI GODSE HEMANT TUKARAM:

Will the Minister of FINANCE be pleased to state:

- (a) whether  the  premiums  payable  for  health  insurance  cover  provided  by  public  and  private insurance companies have been revised upward recently and are very highly unbearable to the lower income/ economically weaker sections of the country;
- (b) if  so,  the  details  thereof  and  the  reasons  therefor  along  with  the  percentage  of  insurance penetration in the rural and urban areas of the country;
- (c) whether the Government proposes to review the rates of health insurance premiums to reduce the same and adopt a mechanism to put caps on their rates;
- (d) if so, the details thereof and the reasons therefor;
- (e) whether the Government has allowed paying health insurance premiums on installments and if so, the details thereof; and
- (f) whether the insurance premiums of other products such as vehicle, home, etc. on insurance would also be allowed to pay in installments and if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)

(a)  to  (d):  Insurance  Regulatory  and  Development  Authority  of  India  (IRDAI)  has  informed  that  no instances have come to its notice where upward premium revisions were done recently which are very highly unbearable to the lower income/economically weaker sections of the country.

The Insurance penetration for India, measured as the ratio of premium to Gross Domestic Product, was  2.72  percent  for  Life  Insurance  and  0.72  percent  for  General  Insurance  in  2015.  Health Insurance is a part of General Insurance. The Insurance Penetration for the insurance sector as a whole  in  the  year  2015  was  3.44  per  cent  in  India.  IRDAI  does  not  maintain  penetration  data separately for rural and urban areas.

Further,  Rashtriya  Swasthya  Bima  Yojana  (RSBY)  provides  smart  card  based  cashless  health insurance  cover  of  Rs.  30000/-  per  annum  to  BPL  families  along  with  11  other  categories  of unorganized workers. A majority of the beneficiaries of RSBY are from rural areas.

As  far  as  the  premium  is  concerned,  the  Insurer  takes  various  factors  such  as  loss  ratio,  claims experience,  inflation  rate  and  other  actuarial  parameters  into  account  while  finalizing  the  premium rates.  Further, the pricing is also examined by the Actuarial Department of IRDAI and on confirmation by the Actuarial Department the final premium is approved by IRDAI.

(e) & (f): Generally, Health Insurance policies with more than one year term and group health policies offer  instalment  facility.  As  per  Rule  (59)  of  Insurance  Rules,  1939,  policies  under  Sickness Insurance,  Group  Personal  Accident  Insurance,  Medical  Benefits  Insurance  and  Hospitalization Insurance Schemes; Premiums on such policies may be accepted in instalments provided that the instalment  covering  a  particular  period  shall  be  received  within  fifteen  days  from  the  date  of commencement of the period. The option for paying premium payment in instalments is not available for  Home and Vehicle Insurance products. However, as per Rule 59 of the Insurance Rules, 1939 premium payment in instalments is allowed on products under Aviation, Marine Hull and Engineering insurance.

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