Govt Relaxes Co-Pay Terms for Group Health Insurance Policies

To make group health insurance policies work successful for public sector insurers, the government has eased co-payment terms for group health insurance policies and reduced mandatory cap of 20% co-pay to 5% on acquisition cost.

The Finance Ministry, in a letter to the four state-run insurance companies, said that, acquisition cost should be reduced to 5% on group health insurance policies, irrespective of the claim ratio.

The decision of introducing co-payment with group health policies is to reduce claims burden. In an earlier letter, Finance Ministry had asked insurers to compulsorily have 20% co-payment with all group health policies.

Many of the insurance companies have found this decision sensible because, high percentage of employees would resist the inclusion of 20% co-pay.

The four state-run insurers New India Assurance, Oriental India Insurance, National India Insurance and United India Insurance, have made a representation to the govt to relax some of the earlier norms on group health policies.


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