New India Assurance – a state run insurance company, has decided to do away with the extra charges it levies on insured people with pre-existing conditions like diabetes and hypertension. With this news taking a number of people aback, we decided to ask Segar Sampath Kumar, General Manager and transparency officer of the company about the move and how it will affect people insured under its health insurance scheme. Here are excerpts from the interview:
Why the sudden reduction in the premium amount?
We felt that it was causing a lot of trouble for our customers. Take this example, suppose there is a person A who has applied for a policy in the year 2007 and he/she did not have either diabetes or hypertension while applying for the policy. He/she gets a health insurance policy that covers all medical bills. Another person B, suffers from diabetes while applying for the policy and discloses it. The company provides him/her with a policy that excludes cover for four years along with an extra charge added to his/her premium. Now A is diagnosed with diabetes in the year 2008, and he/she gets treatment for it, and asks the insurance company to pay for the expenditure of medicines to treat diabetes. This leaves B feeling like they have not been given a fair deal since he/she does not get the same benefits as A only because he/she had the disease before A. And A feels that since he/she contracted the disease after buying the policy, He/she should be covered appropriately. What would be the right thing to do?
That is why we were left with a dilemma and it was both cumbersome to the company as well as the patient. Therefore we decided that we should scrap the entire addition to the premium. It is also a move to simplify the entire process of identifying false claims.
This news has spread like wild fire, are you the only company that is providing this subsidy?
Yes, as per my knowledge we are the first company who has done this. No other company in both the government and private sector has granted such a subsidy.
But, it says that the health policy will still retain the four year waiting period before the insured can use the policy, is this best plan to help the ailing?
As for the 4 year waiting period. Diabetes is a lifelong chronic condition. If managed appropriately there is no risk of additional exposure (patient usually does not have a change in his or her status). We do give 50% costs of the medical care from the 2nd year and 75% of the costs from the third year. In the new policy this provision will not be available. We will cover preexisting conditions only after 4 years of waiting period.
Apart from cutting down on the premium the company has also decided to cover diseases arising from smoking, but does not cover liver cirrhosis which is usually caused due to alcoholism. While the subsidy is definitely something that most people want, will the changes go down well with their consumers?