Health Insurers May Likely To Introduce Co-Pay in Group Policies

Following the order from the Ministry of Finance to cut losses in insurance industry, all the public sector general insurers are likely to introduce co-pay ratio in all new group health policies.

Co-pay refers to some percentage of amount or a part of the eligible claim that a policyholder has to pay and the balance amount will be paid by the insurer. Typically this ratio could be from 10-25%. For instance, if a policyholder claims for Rs.100, then he/she has to take out Rs. 25 from his/her pocket, before the company contributes Rs.75.

Insurers adopt this type of tool to avoid policyholders from opting high-end hospitals and also from availing treatments which they would have avoided previously in the absence of health cover. However, this doesn’t mean that presence of co-pay clause would imply that all your claims will be subject to the same. This clause is to avoid policyholders to undergo treatment in certain metropolitan cities despite paying premiums applicable to smaller cities.

So, every policyholder before insuring themselves, have to study policy terms and conditions closely before signing up for a new cover or renewing the existing one.