Star Health on IRDAI radar for health insurance claim settlement practices, ET BFSI
Insurance coverage watchdog IRDAI has found critical lapses within the declare settlement practices of stand-alone well being insurer Star Health and Allied Insurance coverage, based on CNBC-TV18. Whereas the official investigations are but to conclude, the regulator is prone to take motion towards the insurer. Aside from Star Well being, IRDAI has additionally scrutinised 8-10 different common and well being insurers within the nation. Nevertheless, no phrase of any motion being taken towards them has been reported.
In accordance with the report, IRDAI examined varied claim-related features, such because the variety of claims repudiated and accepted, deductions, queries raised by policyholders, and so on.
As per an official assertion by Star Well being, they haven’t acquired any communication from IRDAI on this matter
“We want to reassure all our stakeholders that at Star Well being Insurance coverage, we’re dedicated to a customer-centric strategy, guaranteeing that our processes and practices align with the very best pursuits of our policyholders. IRDAI conducts common audits and thematic inspections as a part of its regulatory oversight in step with the framework outlined in its grasp circulars. These assessments are a routine course of to make sure compliance throughout the business. The media assertion gave the impression to be speculative and motivated in nature, and we’ve not acquired any communication on this topic from the regulator.”
Declare settlement document of the insurer not very encouraging
As per IRDAI’s handbook of insurance coverage statistics, Star Well being’s incurred declare ratio, i.e., the quantum of premiums any insurance coverage firm pays out as claims with the full premiums it has collected in a 12 months, for the 12 months 2023-2024, stood at 66.47%.
In essence, which means that for each Rs 100 that Star Well being collected as premiums, it solely pays roughly Rs 67 in direction of honoring policyholder claims between 2023-2024.
That is solely marginally greater than the full incurred declare ratio of stand-alone well being insurers, which stood at 63.63% throughout 2023-24, whereas being considerably decrease than the 82.52%, which was the cumulative incurred declare ratio for all well being and common insurers lively within the nation throughout 2023-24.
Excessive on declare rejections, complaints acquired
Star Well being and Allied Insurance coverage Co. Ltd. additionally recorded the bottom declare settlement ratio inside 3 months amidst all stand-alone well being insurers, at 82.31% for the 12 months 2023-24. Throughout this era i.e. 2023-24, the corporate settled 2.74% of its claims inside 3-6 months. About 0.35% of claims had been accomplished away with inside a interval of 6 months and 1 12 months. Star Well being had a declare settlement ratio of 0.074% for a time interval of over 1 12 months however lower than 2 years. Round 0.03% of the corporate’s claims took over 2 years to settle.
As per the IRDAI handbook, Star Well being repudiated or rejected 2,96,356 claims between 2023-24. That is considerably greater than Care, which ranks second on this record with 76,903 claims rejected throughout the 12 months. Others within the stand-alone well being insurer class, particularly Aditya Birla Well being Insurance coverage, rejected 57,414 claims, whereas Niva Bupa and Manipal Cigma rejected 55,185 and 50,480 throughout FY2023-24, respectively.
Furthermore, the variety of policyholders’ grievances with Star Well being firstly of FY 2023-24 stood at 797, the best amongst all common and well being insurers, barring public insurer Nationwide Insurance coverage Co. Ltd, which stood at 1,638.
It additionally acquired the utmost variety of complaints throughout the 12 months, at 16,804, which was the best amongst all common and well being insurers within the nation. Out of those, 16,603 had been precise complaints. The second closest to Star within the record of complaints reported throughout FY 2023-24 was United India Insurance coverage Co. Ltd., which noticed 7,181 complaints being reported throughout the 12 months.
