The pandemic has changed the face of the insurance market. Do you know how?

health insurance

Health insurance has been at the forefront, in terms of need, in this Coronavirus pandemic. As the cases cross new milestones every few days, people are increasingly feeling the need to invest in a health insurance plan which would cover their medical costs if they were to test positive of COVID. The insurance regulator, IRDAI (Insurance Regulatory and Development Authority) has also issued various circulars asking health insurers to make their plans more customer-centric and inclusive. 

Just recently IRDAI urged health insurance companies to offer a standardized health insurance policy with uniform coverage benefits. This resulted in the birth of the Aarogya Sanjeevani health insurance plan. Then, with the onslaught of COVID, COVID specific health insurance plans – Corona Kavach and Corona Rakshak, were introduced. Are you aware of these changing market dynamics?

Coronavirus and health insurance

In the pre-COVID world, health insurance was deemed as a solution to meet the financial strain at the time of a medical crisis. This medical crisis could have been due to accidental injuries and/or illnesses. Individuals invested in health insurance plans for financial security so that if a medical emergency would strike them or their loved ones, the plan would allow them quality healthcare without worrying about the costs.

However, with the incidence of Coronavirus, people woke up to the need for health insurance to cover the hospitalisation costs incurred on Coronavirus treatments. While normal health insurance policies cover hospitalisation costs, they don’t cover the cost of consumables and home treatments. IRDAI, therefore, felt the need of a COVID-specific coverage which would cover all the medical expenses incurred on COVID related treatments.

On July 10, 2020, two new health plans were, therefore, launched called Corona Rakshak and Corona Kavach. Here’s a quick look at both –

  • Corona Rakshak health plan

    Corona Rakshak is a fixed benefit health insurance plan which pays the sum insured in lump sum if the insured member tests positive for COVID and is hospitalised for at least 72 hours. This lump sum benefit can be used to pay for medical treatments or to meet any other financial needs that the insured might have.

  • Corona Kavach health plan

    Corona Kavach is an indemnity health plan which covers the actual cost of hospitalisation and treatment which is incurred if the insured tests COVID positive and is hospitalised. The plan also covers home treatment expenses as well as the cost of consumables like face masks, sanitizers, gloves, PPE kits, etc. Coverage is allowed after a short waiting period of 15 days and there are no deductibles or other waiting periods.

Both these policies are issued for a short-term period which can be chosen from three available options of 3.5 months, 6.5 months and 9.5 months. The coverage under both the plan, offered by different companies, remains the same while the premium rates might vary depending on the insurer’s pricing policy.

So, while the normal health plans might not cover COVID treatments completely, these plans do the needful. Moreover, the premiums of these policies are low and affordable ensuring that individuals can easily invest in the plan for their immediate coverage needs against COVID.

The Aarogya Sanjeevani policy, on the other hand, is an affordable and comprehensive health insurance plan for individuals looking for basic health insurance coverage at low premium rates.

How do the changing markets affect you and your clients?

As the importance of health insurance is increasing, your clients might be looking for a way to enhance their existing coverage or to invest in new plans for covering COVID related claims. You, as their financial advisor, can help them invest in a policy which would not only cover COVID related cases but other medical contingencies too. Help your clients assess their existing coverage and supplement it if required. If COVID coverage is their immediate need, advise them to invest in the two COVID-specific health plans. 

 Change is constant and if you keep yourself updated about the changes happening in the insurance industry, you can adapt to the changes and grow your business. So, understand the need of the hour, prioritize health insurance for your clients’ coverage needs and keep pace with the ever-changing dynamics.

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