INSUBCONTINENT EXCLUSIVE:
Ayushman Bharat scheme credit positive for insurers: Moody's Mumbai, Aug 23 () The government's flagship health insurance scheme, Ayushman
Bharat, is credit positive for insurance companies as it will aide in higher premium growth, a report said
Prime Minister Narendra Modi, in his August 15 speech, has said that the Ayushman Bharat-National Health Protection Mission (AB-NHBM) will
be launched on September 25
The scheme will cover over 10 crore poor families and would provide a health insurance coverage of up to Rs 5 lakh per family per year for
secondary and tertiary care hospitalisation
"The launch of universal health coverage is credit positive for the country's insurers because it will help grow health premiums and
provide insurers with cross-selling and servicing opportunities," international rating agency Moody's said in its report today
Health insurance contributes around 23 per cent of general insurance premiums and is one of insurers main drivers of growth, according to
During fiscal year 2011-12 to 2016-17, health premiums have grown at a compound annual growth rate of 18 per cent
As of FY17, only 440 million people were covered under health insurance schemes, and the rating agency expects the AB-NHBM to increase that
The report, however, said out of the 29 states, 23 have chosen to run the scheme as a trust model, which will diminish insurers' growth
However, the ratings agency expects that insurers with scale advantages and track records of managing large insurance schemes will benefit
from the health programme
Trust models entail government funds being allocated to a trust fund rather than to insurance premiums, and the trust fund making
disbursements for claims, rather than insurers disbursing claims
When the trust fund is depleted, the government will need to provide additional funds
