Will your health insurance premium rise in 2023?

Insurers have seen a significant increase in claims recently, due to increased hospitalizations, critical illnesses, and diseases related to monsoons, such as Dengue and Malaria. Consider this, ICICI Lombard General Insurance’s claim ratio in Q2FY23 increased to 82 percent compared to 74 percent in the previous quarter. Similarly, Star Health Insurance’s claim ratio increased from 67 percent to 68 percent in Q2FY23.

During the Covid period, all insurers saw a huge jump in their claims due to the increase in hospitalizations. However, it was expected to drop to pre-covid levels if cases start to decline. But insurance companies say it’s not just special surgeries that the frequency of general and critical medical cases has increased post-covid, which may be due to the prolonged covid.

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Will this increase in claims lead to an increase in health insurance premium rates in 2023? “Life in retail is a long-term career. Therefore, you need to constantly monitor the performance of the portfolio according to its experience. And at various times, wherever necessary, you need to make effective price revisions. ” said Gopal Balachandran, Chief Financial Officer and Chief Risk Officer at ICICI Lombard. The last price revision by ICICI Lombard was in the third quarter of 2021 when the average premium was increased by 8 percent.

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Experts say that while claims rates were largely stable in the first two quarters of the 2022 calendar year, they saw a sharp increase from September onwards. The increase is due to higher incidence rates across certain disease categories, particularly elective surgeries and critical illnesses leading to higher claims ratios across the industry.

“Premium revisions are closely linked to medical inflation which in turn is a function of several factors such as rising costs, new developments in treatment, technology etc. These factors are always present in a growing economy like India and hence will continue to impact health insurance premiums as every insurer revises its price. from time to time for each product. However, a pandemic like Covid has brought a lot of changes in medical procedures that also affect costs. If these changes are permanent, these things may also affect premiums in the long run. of premium rates under the Insurance Rules issued by IRDAI,” said Prasun Sikdar, Managing Director and Chief Executive Officer at ManipalCigna Health Insurance Company.

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Moving forward if the frequency of claims continues to rise, especially with the impending fear of the next wave of Covid-19, one can expect another rate hike soon in health insurance policies.


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