The Tamil Nadu government has awarded the state government-sponsored health insurance contract to public sector general insurer United India Insurance Company.
The new scheme, which replaced the DMK Government's Kalignar Health Insurance Scheme, extends medical cover up to Rs 4 lakh for four years, up from Rs 1 lakh in the earlier scheme. It is expected to generate a premium of around Rs 600 crore.
Company and government officials have confirmed that United India is the new partner for the government.
The scheme, which will be launched by chief minister J Jayalalithaa on Wednesday, will also cover 950 types of medical treatment, while the previous scheme covered 642 types.
The Project Director of Tamil Nadu Health System society will pay the premium on behalf of the beneficiaries.
The earlier scheme, which was managed by Star Health Insurance, was scrapped by the AIADMK government, which took charge in May 2011.
Sources said the new scheme would give priority to government hospitals, over those in private sector.