Health insurance pulls all four PSU insurers into the red
NEW DELHI: All four public sector general insurers are in the red, mainly due to losses of more than Rs 26,300 crore incurred in their medical portfolios in the five years 2016-17 to 2020-21, a report by the Auditor General and Auditor General (CAG) of India has revealed.
In its report is listed in Parliament on Friday, CAG said the losses were caused by group policies, where premiums are charged less and claims are more than retail policies. Audit includes New India Insurance Co., Ltd, United India Insurance Co., Ltd, Phuong Dong Insurance Co., Ltd and National Insurance Company Limited and put their combined loss at Rs 26,364 crore.
About 10 years ago, PSU insurers took the initiative to have their own hospital network by forming a Preferred Provider Network (PPN). It shows that four PSU insurers together have PPN agreements with just 2,552 hospitals (compared to 9,900 hospitals for Star Health Insurance Co. Ltd and 10,000 hospitals for HDFC Ergo General Insurance Co. Ltd). “This shows an inadequate effort by PSU insurers to link up with a larger number of hospitals,” the auditor said.