Are you a fitness buff, and regularly go to gym or running? Is your friend of the same age has never even seen a gym and does not seem to consider hitting one? Sadly, you both are same in the eyes of insurance companies. You both will be charged the same premium irrespective of your pro-active healthy habits and your friend's sedentary lifestyle. Unfair, right? Thankfully, things are beginning to change. You may soon get to monetise your fitness. If you are a part of a running or a cycling group, you can even buy a policy together with your group mates and claim combined discounts.
Insurance Development Regulatory Authority of India (IRDAI) recently has given approval to 19 innovative health insurance products under sandbox that will cater to specific needs of customers. The prominent ones include friend assurance, wearable health devices, short-term health insurance, need-based health insurance, payment over reward points, app-based healthcare and more.
With most people increasingly being conscious about fitness, they often join a marathon, cycling or trekking groups or fitness centres. From an insurer's point view, they will surely have better health profile than an average customer. Secondly, because these groups often meet and take interest in each other's fitness journey, they work in cohesion. Keeping these special interest groups in mind, three insurers - Max Bupa Health Insurance, Religare Health Insurance and Kotak Mahindra Health Insurance - have received IRDAI's approval to launch Friend Assurance product wherein a group of friends or family may buy policies together for combined benefits.
In case of Max Bupa, every single individual will pay his or her premium and in return get individual sum insured along with floating sum insured. For example, if members of a group buy a policy of Rs 5 lakh sum insured (SI) each, along with this SI, they will also get floater limit of Rs 20 lakh. Any member can dig into floater amount if individual SI has exhausted.
"The individual premium in the group will be lower compared to what a traditional policy will offer as we'll be able to offer them better rate because all will come together. There will also be wellness-linked incentives," says Ashish Mehrotra, MD & CEO, Max Bupa Health Insurance.
Religare has applied this concept on existing policies wherein they will return 10-15 per cent premium at the end of the year if no claims are received from any person. "We may come up with customised health policies in due course," says Ashutosh Shrotriya, product head, Religare Health Insurance.
Star Health, Max Bupa, and Kotak Mahindra General Insurance are the selected companies in the wearable tech category. While most insurers already offer footstep-based discounts via their apps, these companies have got approvals for specific wearable devices. "With this, now measurement will be more accurate. For now, we'll be offering it to our existing GoActive policyholders," Mehrotra of Max Bupa says.
While in-patient department expenses (IPD) are covered in a good way, hardly any options are available for out-patient department (OPD) coverage in a comprehensive manner. "Study says two-third of total healthcare spend in India is on OPD. With this thought, we structured the product called 'OPD and Wellness with Integrated Flexible Rewards program'. We have integrated OPD and wellness so that we can play a proactive role in managing customers' OPD spends, and at the same time reward them for displaying good behaviour. We will give them points based on their activity level and healthy behaviour. They can redeem those in our network of clinics," says Shrotriya of Religare Health.
Religare has come up with a short-term health insurance product that will let you buy policies for a specific period during which you want insurance. "This policy is suitable for those coming to India for a short period or people who are unemployed for a short duration between switching jobs. There could be instances where a husband has to align his policy date with that of his wife. They can discontinue one of the policies and buy a short-term policy for the spouse who is un-covered and align dates accordingly," Shrotriya of Religare says.
Need-based health profile
This product is more of a pricing tool to fix your premium on an individual basis. Currently the premium on policies is charged based on age and in some cases geographies. Based on data available on underwriting and claims side, Max Bupa has devised a dynamic pricing model where every individual will be offered different pricing. "All 35-year-old will not have to pay same premium. They will be asked a set of questions on their health, family history and lifestyle etc. If it doesn't suffice, we'll do a second layer of due diligence through tele conference, where much more detailed questions on health profile will be asked. If it doesn't help either, finally we'll send that person for medical check-up. On the basis of reports, we'll fix the price of the policy," says Mehrotra of Max Bupa.
Need-based health insurance
Traditional health polices do not cover critical illness unless charged extra. They come up with a waiting period too for pre-existing diseases. However, people may only want coverage for specific diseases, not a comprehensive health plan. Digit Insurance's need-based health insurance will cater to this segment. "There will be covers such as Dengue Cover, Vector borne Disease Cover, Women Specific Illness Cover, Breast Cancer Cover, Cervical Cancer Cover, Malaria, Typhoid & Jaundice Cover, Health Illness Diabetes Cover etc. The intent of these is to break down needs of people in different life-stages, genders and locations and give them what will be most beneficial to them," says Adarsh Agarwal, Appointed Actuary, Digit Insurance.
App-monitored health programs
ICICI Lombard General Insurance has received approvals for the app-based features to take care of Diabetes and Cholesterol - App-monitored Diabetes Mellitus Wellness Program and Dyslipidaemia Management Program.
"A customer who opts for these programs will be offered a disease management application along with a nutritionist counselling for diet. The program allows tech-based mobile application and monitoring services to bring out the best of an insured individual. A customer who exhibits good behaviour by following a diet and a fitness regime will be rewarded by wellness points and this entire process will be monitored through the mobile application," says a press release by ICICI Lombard.
Bajaj Allianz's co-pay model is also based on app for which it has tied up with GOQii, which provides an app-based healthcare platform with live and interactive sessions with fitness coaches who guide you on your health journey. The co-pay model will help you reduce your share of burden on co-pay policies at the time of claims. "Under the co-pay model, based on the engagement level of insured on the health platform offered by GOQii the percentage of their co-pay will be decided," says Tapan Singhel, MD & CEO, Bajaj Allianz General Insurance.
Redeem reward points
Often we receive reward/loyalty points from various brands but don't end up using those. What if we redeem those to buy an insurance? This is what Religare's 'payment through reward points' policy will do. "We'll tie up with loyalty program runners and they will feature us in their catalogue of products where reward points can be utilised," says Shrotriya of Religare.
'Shagun- Gift an Insurance' by SBI General Insurance is another interesting product that has received IRDA's approval. "This is a concept whereby a proposer can gift an insurance policy to any member of their extended family (spouse, children, parents, parents-in-law, siblings, cousins, grandparents and grandchildren). It consists of a personal accident cover along with the option to select emergency medical services and ambulance cover. Traditionally in India, cash is given on auspicious occasions such as festivals by way of 'shagun'. Here, by gifting an insurance policy instead of money, we are hoping to increase insurance penetration," says Subramanyam Brahmajosyula, Head -Underwriting & Reinsurance, SBI General Insurance.
Insurers will launch pilot phase of the products for the six months between February 2020 and July 2020, following which they will submit their performance analysis based on a set of success parametres specified by the regulator such as underwriting 10,000 lives or collecting Rs 50 lakh premium during the course of six months.