State owned general insurer National Insurance Company is studying the performance of its health insurance portfolio. To keep up with the increasing costs of healthcare, National Insurance may increase the premiums for its health insurance policies. These would be applicable to new policy-holders and when the existing ones come up for renewal.
The current premium rates for health insurance plans were set 3 years back and prices of most health treatments have increased since then. Currently the company is collecting data and analysing the impact. The premium rates may go up by 15% or more. The company is not only looking at increasing premiums to improve its performance, it is even looking at reducing fraudulent claims and making structural changes in its products.
Most health insurance portfolios of general insurance companies are loss making as the claims are usually more than the premium collected. And if you add the management costs to the policy, the core business is not a profit making vertical. The general insurers usually make profits through investment income.
