30 Minute Interview

'Health Insurance is a Key Growth Engine for Us'

With prediction of premium collected from health insurance to go up to Rs 15,000 crore by 2015, even life insurance companies which were earlier providing health insurance as a rider have also started offering stand alone health insurance products. ICICI Prudential Life has entered the health insurance sector with a range of innovative products. Bhargav Dasgupta, Executive Director, ICICI Prudential Life, speaks to Express Healthcare about its range of products and the road ahead for the company. Excerpts:

Bhargav Dasgupta Executive Director, ICICI Prudential Life

From a company giving critical illness riders along with life insurance, what motivated ICICI Prudential Life Insurance Company to design standalone healthcare insurance products?

The company forayed into the health insurance segment in January 2006, keeping in mind the huge need of health insurance products in the country. Today, less than 15 per cent of the Indian population has any formal health cover of which only two per cent have health insurance. This is at a time when lifestyle-related diseases are on the rise as also the costs of medical care. With no formal health cover, individuals are sometimes forced to dip into their savings to meet any healthcare expenditure. Given the large opportunity and the synergies with our existing business, ICICI Prudential Life entered into the health insurance space.

We now offer both the options to our customers. However, the decision to take a rider or a standalone health insurance plan is based on the customers' choice and convenience.

ICICI Prudential Life Insurance Company has recently launched Hospital Care, which gives long-term coverage for a term of 10-20 years from 1-60 years and that too till 80 years of age. What kind of risk is entailed in providing such a product? Is this a profitable product? How many policies could you sell for this product?

ICICI Prudential Life launched Hospital Care in April 2007 to ensure customers have a product that takes care of all their expenses related to hospitalisation. Existing hospitalisation policies in the market are yearly renewable policies which charge higher premiums on renewals if a claim has been made in the previous year. Hospital Care is a fixed-benefit product that provides transparency in the payout and enables customers to plan and meet expenses associated with hospitalisation. Moreover, this policy offers guaranteed cover for up to 20 years.

Hospital Care has been priced taking into account the risks involved and it is currently too early to comment on the profitability of the product.

With private life insurers like Tata AIG and Max New York Life also coming up with standalone health insurance products, what would be the impact of such a trend?

With more and more companies entering this space, we can expect two clear developments in the years to come.

One will be on the products front and the other will be regarding distribution of these products. Health insurance will offer more customised, innovative and feature-rich products, with a more a holistic approach to customer benefits.

The robust retail distribution network of each company will be instrumental in taking health insurance to many more customers, across the country.

ICICI Prudential Life was one of the first ones to design disease-specific products for cancer and diabetes. Do you have any more of such products in the pipeline?

As a strong player in the health insurance segment, we will continue to offer products that are designed to meet different customer needs, be it disease specific or comprehensive coverage products that are rich in features.

Do you have any standalone health insurance products for senior citizens in the pipeline? Do you have any in the pipeline?

Most of our health insurance products have the maximum entry age at 60 years with cover being provided up to 80 years of age.

According to the IRDA, a certain per cent of any insurance business should come from micro insurance. Do you have any products targeting that segment just yet?

According to the IRDA, every life insurance company must do a certain percentage of their business through micro-insurance. This percentage is determined by the number of years the company has been in existence. For ICICI Prudential Life, this number is 19 per cent and we do offer products to meet our obligatory business.

Corporates prefer taking health insurance products from non-life insurance companies as they can avail of a gamut of products. Has this led life insurance companies like yours to only sell products to individuals and not corporates? In such a scenario, do you find it difficult to sell health insurance products to corporates?

We have a strong presence in the corporate market with our annuities and gratuity business. We have taken a phased approach to health insurance and have introduced products targeted at the retail market first. We would subsequently look at developing products for the corporate market as well.

What is your solvency ratio?

ICICI Prudential has maintained its solvency ratio in excess of 150 per cent as per statutory requirements

What is annual rate of growth of the health insurance segment of your company?

Over the last 18 months, ICICI Prudential Life has strengthened its position as a health insurer, substantially. Today, we offer a range of comprehensive health products for customers to choose from. Keeping in mind our nascent stage in this business, we can say our journey has been successful and we do feel that health insurance will be one of our major growth engines in the coming years.

How many offices, advisors and bank partners do you have?

Currently ICICI Prudential Life's distribution network constitutes of 783 branches, 265 micro-offices in 840 towns and cities. Our advisor base stands at over 243,000 and bancassurance partners at 21 with tie-ups with some of the leading banks in the country, for example ICICI Bank, Bank of India, Federal Bank, South Indian Bank, to name a few.

How are you marketing your products? Are you targeting both the urban or semi-urban areas?

In addition to expanding our distribution footprint across urban and semi-urban areas in the country, we support the sales team with a robust market communication programmes that are aimed at informing the customer about our products. These include both above the line and below the line activities that range from mass media campaigns, road shows, events, customer education programmes, among other initiatives.

What are you future plans in the health insurance segment?

As mentioned, health insurance has been recognised as one of ICICI Prudential Life's key growth engines and we are committed to provide more comprehensive health insurance solutions to customers.

Keeping in mind the huge requirement for health insurance products to cover the entire need spectrum, ICICI Prudential Life will continue develop products that will enable customers to take care of their healthcare expenses efficiently and effectively.

healthcare@expressindia.com