General Insurers Offer Tpas 5.5% Of Premium

The state-owned general insurance companies have set a cut-off rate of 5.4-5.5 per cent of the premium collected for third-party administrators (TPAs) for services rendered.

General Insurers' (Public Sector) Association of India (Gipsa) had invited bids from TPAs for alliances last month. Only 10 of the 19 TPAs registered with the Insurance Regulatory and Development Authority were shortlisted by the body last night in a closed-door meeting at the New India Assurance Company office. The public sector insurers rejected applications of Paramount Healthcare and Heritage on technical grounds.

Financial bids received from winning TPAs ranged between 6.2 per cent and 6.3 per cent, but Gipsa has set the cut-off price at 5.4-5.5 per cent of premium income for servicing Mediclaim policyholders. In contrast, sharing of premium for overseas Mediclaim policies stands at 3.5 per cent.

 

The individual public insurers now have to appoint the short-listed TPAs region/zone wise, said Gipsa officials.

Family Health Plan (belonging to Apollo Hospital), Ican Medicare, Parekh Health, E-Merck, MD India, Medicare Goa, Medicare Calcutta, and Medi-Assist are some of the TPAs shortlisted.

It is now up to the TPAs to accept the cut-off quote and then be empanelled and enter into a memorandum of understanding with the public insurance companies.

Despite the delinking of the four state-owned general insurance companies, whereby the Parliament has given them full autonomy, they have preferred to adopt a uniform approach in servicing Mediclaim policyholders.

"The product is the same and we are all addressing the same client," said a senior official from Oriental Insurance Company.

Gipsa had set out stiff technical terms and conditions for TPAs to fulfill before they could be eligible to make a financial bid. Aside from insisting that the TPAs had to have one year experience, Gipsa in the application document had outlined that TPAs have to tie up with at least five hospitals at the state capital level in the respective zones, as well as two hospitals at other centres to service policyholders. The idea behind networking with hospitals is to establish cashless hospitalisation service to policyholders. It will also help reduce the high claim ratios currently presiding in the industry.

Gipsa had also set a detailed list of the kind of IT support that TPAs had to set up as well as a toll-free 24-hour call service, among others.