New India, very recently launched a newer version of its existing mediclaim policy with the name New India Assurance Mediclaim Policy 2012.
This was a much awaited revision, as we were curious to know how the largest general insurance player with a turnover of INR 12500 Cr. in the health insurance industry reacts to the rising private sector competition which is busy launching products with innovative features like No Maximum Entry Age, High Sum Insured Covers (More than 10 Lakhs), Higher Cumulative Bonus, Restore features, Coverage outside India, in the market.
Our (now seemingly misplaced) expectations met with a tweaked product, with hardly any great changes to write home about. Moreover, we observe that many positive changes made are in lieu of the recent Health Insurance Regulations made applicable by IRDA recently. This product incidentally also makes it the first product to be approved post applicability of the new IRDA (Health Insurance) Regulations 2012
Moving on to the product, let’s first summarize the existing product so that we can have a perspective of the changes, and their impact.
New India Assurance Mediclaim 2007 – Summary of the Older Version.
This product was a traditional standard mediclaim policy with covers on basic hospitalization and allied expenses, with the usual list of waiting periods and exclusions.
Prominent highlights of this product were:
- Zone wise premium structure. Customers need to select the zone where they are likely to claim. If they claim in a zone higher they would have to attract a co-pay of 10-20%. For instance, if you are living in Surat (Zone III) and you are hospitalized in Mumbai (Zone I) then you have to foot 20% of the admissible hospitalization expenses as copay.
- Coverage of Hypertension and Diabetes from the 2nd year onwards on a phased manner of gradually reducing co-pays, on payment of additional premium of around 10-20%.
New India Mediclaim Policy 2012 – Summary of changes in the New Version:
With the launch of the product Mediclaim 2012, the following are the salient changes made over the above product.
(+) Positive Changes:
- Maximum Entry eligibility increased from 60 years to 65 years.
- Maximum Sum Insured available increased upto Rs. 8 Lakhs from earlier Rs. 5 Lakhs, with some limitations explained below.
- Daily Cash Allowance introduced for policies with sum insured of Rs. 3 Lakhs and above at 0.1% of Sum Insured upto 10 days in a year.
- Congenital (External) Diseases will be covered from the 5th year, at 10% of the Sum Insured. This is generally a permanent exclusion in most health insurance policies in India.
- Congenital Internal Disease which is not pre-existing (not known) at the time of taking the policy will be covered from the 3rd year of continuous coverage.
- Diabetes and Hypertension have been removed from the 2 year mandatory waiting period. Earlier, even if one did not suffer from Diabetes or Hypertension when buying the policy for the first time, treatments related to these 2 ailments were not covered for first 2 years of the policy. Now this condition has been removed.
- Individual Claim Based loading has been removed. IRDA’s new regulations released early this year, do not allow such loadings.
- Expanded list of Day Care procedures (for which the 24 hours hospitalization limit is not applicable) covered - from 22 to 32.
(-) Negative Changes:
- Premiums have been increased by 14% in the above 55 years age bracket, and around 19% in the 35-45 years age bracket.
The premium is almost 40% higher than products from private insurers providing better features like no surgery limits, better eligibility on hospital rooms etc.
- If one enters in the policy at the age of 55 years, there will be a 20% Copay on admissible claim applicable.
- If one enters in the policy at the age of 55 years or above, he/she can get maximum cover of Rs. 3 Lakh.
- Bills raised by Surgeon, Anaesthetist directly (separate from the Main Hospital Bills) will be limited to Rs. 10000 if paid in cash and Rs. 20000 otherwise. The cheque part was earlier capped at 25% of the Sum Insured, which has been drastically capped to Rs. 20000/-
This, in my opinion, is a drastic step. There are many doctors (who work as consultants) who charge their fees separately, instead as a part of the main hospital bill. This will become a contentious issue at the time of claims, as most customers would be caught unaware with a huge deduction due to such a condition in the policy.
- No Claim Discount reduced from 5% per claim free year to a negligible 3% per year. Maximum cumulative discount reduced from 30% to 15%.
In the age where most insurers are luring customers with increased the cumulative bonus or discount, this reduction is a surprise. Most new products by private insurers are giving a minimum 10% no claim bonus per claim free year, upto 50%.
- Process to enhance Sum Insured in the later years has been made complicated.
- Enhancements in sum insured not allowed post 65 years.
- Enhancement only upto Rs. 3 Lakhs for age 55 and 65 years.
- Enhancement would not be possible if there is a claim made for the member in the preceding 2 years of the policy.
- Rules related to Submission of Claim have been firmed up. Earlier in New India Mediclaim 2007, claims were allowed to be submitted in 30 days from the date of discharge. This has been reduced to mere 7 days.
Comparison of New India Mediclaim Policy 2012 with Mediclaim Policy 2007:
Here is a simple chart comparing major terms of Mediclaim 2012 with erstwhile Mediclaim 2007 and another average Private Sector mediclaim product.
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As mentioned earlier there is hardly anything to talk about, other than word of caution regarding the negatives in the product specially related to Separate Specialist bills and Enhancement of Sum Insured.
Views are personal. Feedback welcome in the Comments Section below.