Family floater health cover plans gain as companies innovate
19 Mar, 2014 01:01 PM
General insurers are reporting greater offtake of family floater health insurance policies, a medical insurance policy whereby a single sum is insured for the entire family for a year.

"The market is moving from individual sum insured to a family floater policy. While the skew is still in favour of individual healthcare covers for us, over time we anticipate equal contribution from family floater and individual health insurance," G Srinivasan, CMD, The New India Assurance said. Nearly 50% of the company's premiums in health insurance come from the retail segment with health insurance accounting for 28% of the company's business.

"From an actuarial standpoint , the probability of two members from the same family falling sick in the same year is very low," Rahul Aggarwal , CEO of insurance advisory, Optima Insurance Brokers said.

New India recently launched a new floater medi-claim policy wherein the family limit can go up to six persons that include the proposer , spouse, parents and children. In addition, the company has also launched a women's family floater policy .

Similarly, another nationalized insurer, United India too has filed a family floater policy for approval with the regulator IRDA (Insurance Regulatory and Development Authority). "The biggest advantage in such products is that there is no need to take separate covers for young as well as old individuals in the family. With not much claims coming in from the young members, the overall average works out much better. Such products contribute to the top line (because of premium differential vis-a-vis individual health insurance policies) as well as the bottom line as there are lower claims from a group in a given year," Milind Kharat, CMD, United India Insurance said.

Even standalone health insurers are reporting rise in sales of family floater covers. Nearly 40% of Apollo Munich's Easy Health Policies are family floaters and in case of Optima Restore, 60% are in the family floater category. "Family floater as an option has just started to take steam in the market and an increasing number of players are now offering it," Antony Jacob , CEO, Apollo Munich Health Insurance said.

Perhaps the single biggest attraction for young families to opt for such covers is that annual premium outflows in such covers can be up to 50% when compared to individual health policies. Take the case of Apollo Munich. Premium under an individual health care policy of 5 lakh under its Optima Restore policy for an individual in the age bracket of 18-35 years would be 5,355 while a family floater cover for the same group would be 7,321.

That apart, rising medical costs (annual medical inflation of 20%) is also forcing many individuals to opt for such covers.
Source : The Times Of India

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