NIC retains group health insurance for bank staff

Bankers' Health Cover

- New policy effective from Nov 1, 2022

- 65% of the policy kept by National

- Remaining 35% shared byco-insurers like Oriental and New India

- Domiciliary hospitalisation for retired staff only change in policy

Mumbai: State-run National Insurance Company (NIC), a Kolkata-based non-life insurer, has retained the entire group health insurance (HI) coverage for all the bank staff and their dependents, numbering seven lakh. Two sources familiar with the development confirmed this to Bizz Buzz on a condition of anonymity.

The premium amount charged by NIC for the renewal of the group health insurance policy is Rs2,150 crore and thus it shows an increase of 20 per cent when compared to the year-ago premium. Another source familiar with the development said that the loss ratio for the policy for the year-ago period was at 110 per cent.

While 65 per cent of the policy has been kept by NIC, the remaining 35 per cent has been shared by co-insurers like Oriental and New India.

Domiciliary hospitalisation for the retired staff is the only change in the coverage for the bank employees in the renewal of the policy this year. The year-long policy has come into effect since October 1 in case of serving employees, whereas in case of retired employees, the new policy will be effective from November 1, 2022.

The health insurance coverage for the bank employees began since October 1, 2015, and it was the Chennai-based state-run non-life insurer United India Insurance (UII), which had bagged the policy for the premium amounting to around Rs700 crore from Indian Banks' Association (IBA). After UII, it was NIC which had bagged the scheme at a premium of Rs2,000 crore in 2-20-21 and it continued to have the scheme until the year 2021-22.

While a coverage of upto Rs4 lakh is provided to the officers under the scheme, in case of employees, the coverage amount stands at Rs3 lakh.

It was a year ago when the IBA had told its members that it has received the revised quotes. The high incurred claim ratio of 147.2 per cent for retirees without domiciliary policy, and 163.3 per cent for retirees with domiciliary policy, have resulted in the increase in premiums.

It was due to the second wave of Covid, which had caused havoc in many States in April-May, causing a higher payout, resulting in an increase in the cost of group insurance policies. Domiciliary cover, which is an extension of the insurance policy to cover treatment from home, charges a higher premium. However, the increase in premium for those with domiciliary cover itself is comparatively lower. For a retired bank employee with an insurance of Rs4 lakh, premium has gone up by 34 per cent without domiciliary cover, and 7.5 per cent with domiciliary cover.

Effort was made by this correspondent to reach out to Suchita Gupta, Chairman and Managing Director, NIC and Sunil Mehta, Chief Executive Officer, IBA, but in vain. For retired workmen, with an insurance of Rs3 lakh, the premium has increased by 40 per cent without domiciliary cover, and by just 8.4 per cent with domiciliary cover. The NIC had offered a lower premium cover for those with a lower sum of insurance. They had also offered lower premium policies for retirees who are survived by a spouse, or for those retirees who have lost a spouse.