How to control Passive Smokers?

Should Health Insurance Premium be adjusted?

Sometimes you come across interesting facts in publications. Economics Times Wealth August 18-24, 2013 has carried the following information

56% is the difference between the premium of a smoker and a non-smoker for a life insurance policy. The question before us is:

If Life Insurance Industry penalizes a person by 56% then what is the figure for Health Insurance? Why not penalize family members / colleagues who are passive smokers and are being compelled to smoke? May be this will result in reduction of smokers in our country.

Few days are left for making Significant Savings in Health Insurance Premium

On April 1, 2012 the service tax on health insurance premium would increase to 12.36% from the existing rate of 10.30%. It means that you have to pay a higher premium. For example if you pay a premium of Rs. 20,000/- for the health insurance premium, this is how you will be impacted:

Let us take elaborate this example. Total premium payable during this 2 years period is Rs 44,532 (Rs. 22060 + Rs. 22472) assuming that you decide to buy it before April 1, 2012.

It will be much better for you to go in for 2 years policy being offered by certain Insurance companies by giving discount of 7.5%.

From the above example you can see that you will be able to save Rs 3,721 on the 2^nd year premium which is equal to 16.87% whereas banks FD for the same duration would not give you more than 6%-7% returns.

Portability of health insurance

As predicted by us vanilla product will be introduced by all general insurance / health insurance companies in near future as the product details are being sent to IRDA. New health insurance product to be sold by all companies will have following features:

•Max sum assured – Rs 2 Lakhs only

•Preexisting diseases will be covered after 4 years

•Max entry age will be 65 years

•No claim bonus – Reduced premium or increased sum assured will be given. Companies like Oriental will have to change their policy of not giving benefit to the customers as far as this policy is concerned.

•Indicative premium for Rs 1 Lakh – up to age 18 years will be Rs 1000, which means that we are sticking to existing rates. We can expect Rs 1400 for someone who is in the 18 -35 age bracket.

•To be introduced by all companies. We feel Max Bupa may not come out with this product. Let us see what will be the stand of Regulator (IRDA) with respect to this-will Max Bupa be asked to introduce this product ?

Let us see what is the ultimate outcome when the product is introduced?

Our suggestion :

Let all the companies come out with a joint advertising campaign –explain benefits of having health insurance. We should aim for 10 crores policies to be sold under this category. With an average policy size of Rs 2500 this should mean premium of Rs. 25000 crores.