Community insurance scheme to be launched this month

Soumya Viswanathan - Mumbai

The four public sector health insurance companies along with General Insurance Public Sector Association (GIPSA) have submitted the formal draft of the community-based health insurance scheme announced by the Finance Minister, to the Insurance Regulatory Development Authority (IRDA) early this month.

In the month of March, the Ministry of Finance had issued a circular to the four General Insurance Corporation (GIC) companies to introduce the scheme at the earliest. The companies along with GIPSA finalised the draft in April.

The draft has been submitted under the "File and use" procedure for new products whereby the IRDA will make its observations, if any, within 30 days. If IRDA does not make its comments within 30 days, the insurance companies are free to launch the product. Officials at GIPSA said that they may not wait for 30 days and go ahead with the launch after conducting informal talks due to the pressure from the centre to bring out the policy.

Officials are positive about this scheme and are confident of its launch by this month end. Officials at GIPSA are optimistic about this scheme in spite of a similar scheme announced during Yashwant Sinha’s budget having failed. Says a senior officer at GIPSA, "The scheme is on group basis and large scale. Secondly, it will have active participation of the NGOs. These are the factors on which the government is banking for the success."

Experts say that the previous scheme failed because of lack of marketing strategies and absence of subsidy, which is being offered in the present scheme for families living below the poverty line. Also, since TPA system was not in place, cashless service was not possible. This time around, the government is proactive in making this scheme successful,say authorities from insurance
companies.

Government has also said that it expects major push from the TPAs. It has directed the public sector companies to give advertisements in dailies, asking NGOs to come forward and develop the scheme. Collection of premium will be through NGOs.

The premium charged will be Re 1, Re 1.50 and Rs 2 per day for an individual, a family of five and family of seven respectively for hospitalisation coverage up to Rs 30,000. Further, if the breadwinner in the family dies due to accident, the family gets Rs 25,000 as compensation. For the loss of working days, the breadwinner is compensated Rs 50 a day for 15 days. There may be some cap on per claim so that entire money is not spent on one person. In the first phase, at least an additional 50 lakh BPL families will be covered during 2003-04.