Health insurance industry is expected to grow at about 50 per cent per annum, Insurance Regulatory and Development Authority Chairman C S Rao said here on Friday.

On the sidelines of the First Health Insurance Summit organised by CII, Rao told reporters that the premium collected under health insurance was only about Rs 600 crore when he took over as Chairman of the regulatory body in 2003.

Whereas, during 2006-07 the premium collection was about Rs 3,200 crore, having grown 35 per cent over the previous year.

The figures for 2007-08 have so far not been released but are expected to be well over Rs 4,000 crore.

“The health insurance business is likely to grow by about 50 per cent per annum,” he said.

Rao, who is close to completing his tenure as Chairman of IRDA said: “The health insurance segment has been growing much more than the overall general insurance industry and collection of premium of health insurance now accounts for about 16-17 per cent of the total collection of the general insurance industry”.

He, however, pointed out that the overall penetration made by the industry segment is still low. At present, there are quite a few players offering health insurance and the IRDA Chairman indicated that a few more are planning to enter the sector.

Referring to the high claim ratio witnessed by health insurance companies, he said the ratio could come down if the volume of business goes up. Besides, he felt if the health policies are sold to different age groups, particularly young, the claim ratio could go down.

This is going to be an interesting year for health insurance. While mediclaim will continue to enjoy a reasonable chunk of the market share, we will also see more product innovations particularly related to ‘health income’ type of products which provide fixed payment due to medical situations,” he says. Chak feels that this type of ‘health income’ product, which covers not only the medical expenses but also any related expenses such as transportation cost as well as post operative medical costs can be used as a supplement of mediclaim policies.

Analysts believe that in the realm of life insurance, these additions of benefits will come in the form of health rider contracts. This essentially means options to select additional health protection on top of the traditional life protection under the same policy. “ However, the customers should buy a cover for their health needs after understanding their perceived medical insurance need and not just look into the advantages churned out of higher return on their investment,” cautions C Chandreshekhar, CMO, Apollo DKV.

Another important aspect of health insurance, which many consumers choose to ignore or fail to realise is the importance of a secondary cover. Experts stress that as a long-term plan, it is strongly advisable that you should have an individual health insurance policy as well as for the family. This also becomes important as the health insurance cover, extended by the employer to its employees ,caters to the medical insurance needs of the individual and his/her family till the time he is employed with the employer.

Once he moves to a new employer, the accrued benefits and the terms and conditions change as per the insurance policy at the new employer. “Having an individual policy not only gives you the leverage of a long standing relation but also supports the waiting term requirements for various critical illness and pre-existing diseases,” says Chandreshekhar. Also, to claim the tax benefit u/s 80D up to Rs 15,000 it is important that you should take a separate policy on an above the employers provided health policy.

It is also expected that with detariffing of other portfolios, chances are high for the market forces to take care of the premium rates at which various differential services to be offered. “The consumer will have more choices, but it is always advisable that you should first have a pure health policy and then look out for a mix health insurance with unit linked features,” says Manoj Aggarwal.

So, if you’re looking for a health cover it’s pertinent that you furnish your medical details in full so as to avoid any discrepancy in the claim settlement process. After all health is wealth!