HT MaRS Survey Indias Best Medical Insurers

Top 5 companies in claim settlement

764

Star Health& Allied

759TATA AIG

748Reliance Gen Insurance

745ICICI Lombard

735

NationalInsurance

Top 5 companies in customer service

758 758752 750 748

Star Health& Allied

TATAAIG

RelianceGenInsurance

ICICILombard

NationalInsurance

Arnab Mitra■ arnab.mitra@hindustantimes.com

NEWDELHI:Blame it on advertisements.Every medical insurer claims it is thebest.And the truth is that almost everyinsurer does offer something that oth-ers donot. So, howdoyoudecidewhichis the best for you?Tohelpyoumake thechoice,webring

you the most definitive answer — theHindustan Times-MaRS Survey ofIndia’s BestMedical Insurers—whichrated 15 top insurers on customer sat-isfaction on settlement and satisfactionon customer servicing.The first which included six param-

eters like claimsettlement,TPArespon-siveness, speed of service, delivery ofpromised services, etc., while the sec-ond included parameters like ease ofproduct enquiry, levels of transparen-cy, quality and spread of hospital net-work, attitude of company agents, clar-ity of diseases covered and excluded,etc. A word of caution will be neces-sary here. The final results were veryclose — meaning there isn’t a lot sep-arating the best from the rest.Our survey shows thatTataAIGand

ICICI Lombard are the (joint) highestranked medical insurers on customerservice, while Star Health & AlliedInsuranceCo. comesout on top in claimsettlements.But the leaders don’t lead by a lot—

a fewpointsmoreononeor twoparam-eters and less on a few others couldhave altered the results quite dramat-ically. Another caveat— overall, satis-faction levels aren’t very high, imply-ing that all companies need to focusmore on serving the customer.Says Raghu Roy, managing director

of MaRS, HT’s knowledge partner forthis survey: “An industry averageof 740(out of a maximum possible score of1,000) on claim settlement satisfactionis definitely not a great score. And thatthe highest score by any company is765, only a few points above the indus-try average, also suggests that the claimsettlement process may never makethe customer fully satisfied.This is, per-haps, to be expected.”This scenario is repeated in satis-

faction with customer servicing.“Customers arenot happy—the indus-try average is 746 (out of a maximumpossible score of 1,000).One fact standsout: that companies donot exhibit highdifferentials from each other on thismeasure.”An interesting finding is that the

industry as a whole seems to be serv-icing customers better in Bangalore,Lucknow, Kolkata and Mumbai.Respondents in these cities gave theindustry scores that are higher thanthe all-India average, both on customersatisfaction aswell as satisfactionwithclaim settlements.Bangalore is the only city to give

scores ofmore than 800 on both theseparameters (respondents gave scores

of 811 on customer service and 810 onclaim settlement).Obviously, companies aren’t being

able to replicate the Bangalore modelelsewhere. This is most obvious inChennai, Hyderabad, Delhi andAhmedabad, which gave the industryscores less than the national average.One fact that stands out is that pri-

vate insurers have stolen a clearmarchover their public sector counterparts.Except forDelhi,which rankedUnitedIndia Insurance Co. first, none ofthe cities ranked any public sec-tor insurer on top.Clearly, every single com-

panyhasa longway togo.

HT Correspondent■ letters@hindustantimes.com

NEWDELHI: In theHT-MaRSsurvey, cus-tomer satisfaction on customer serv-icing and interaction was measuredusingsixparameters—productenquirystage, purchase transaction, policyissuance, hospital network, renewal,and transparency.And the public sector National

InsuranceCompany (NIC) ranked third,coming after private sector Tata AIGand ICICI Lombard.There was also that little matter

about it being the only state-ownedcompany to feature at all among thetop five in terms of customer satisfac-tion.The surveywas carriedout among2074medical insurance policy holdersin eight major cities of India — Delhi,Lucknow, Kolkata, Mumbai,Ahmedabad, Chennai, Bangalore andHyderabad.While industry analysts said that the

insurerhadresorted to reasonablepric-

ing,whichwent in its favour, insurancesector experts pointed out that claimssettlement takes longer in NIC com-pared to its competitors, which mightexplain the third position.“It takes about one to one-and-a-half

months for settlementof claims inNIC,”said a leading third party administra-tor (TPA), on conditions of anonymity.So what can public sector insurers

do to get better in the area of customersatisfaction?The four PSU insurers — National

Insurance Company, New India

Assurance, Oriental Insurance andUnited India Insurance—which togeth-ermanage about R6,000 crore of healthinsurance business, complain aboutbeing saddledwithacommerciallyunvi-able claims settlement ratio of 115%.They have to say that the way TPAsfunction also has a major bearing oncustomer satisfaction, and forming acommon TPA is one way of cuttingdown on costs.“The four state-ownedgeneral insur-

ance companies are looking to engagea third party administrator to ensure

that customers arenot put throughanymajor trouble especiallywhenwehaveno health regulator, the process is ontrack and we hope to have one soon,”saidNICchairmanandmanagingdirec-tor NSR Chandra Prasad.TPAs are intermediaries between

patients and insurance firms.Typicallystationed at hospitals, TPAs take careof the administrative process ofmediclaimpolicies. “This arrangementwill provide economies of scale to thefour insurers,” saidPrasad.NIChas seta claim settlement target for 2010-11 at90%. And as Prasad lets in, “We arefocusedoncustomer servicemore thanprofits and business models.”As Amit Mitra, secretary general of

industry body Federation of IndianChambers of Commerce and Industryputs it, “The emphasis has to be oncon-sumer awareness and satisfaction, pro-vision of quality health care, improvedinsurance services and greater collab-oration and trust between insurers andhealthcare providers.”

INDIA’SBESTMEDICALINSURERSuser’schoice

THE INDUSTRY AS A WHOLESEEMS TO BE SERVICINGCUSTOMERS BETTER INBANGALORE, LUCKNOW, KOLKATAAND MUMBAI. RESPONDENTSHERE GAVE THE INDUSTRYSCORES HIGHER THAN THEALL-INDIA AVERAGE.

Still room for improvementSPECTRE OF UNCERTAINTY The Hindustan Times-MaRS Survey of India’s Best Medical Insurers reveals that overall, customersatisfaction levels aren’t very high, implying that all companies need to focus more on serving the customer

Whatmakes National Insurance third best

■ Doctors looks on as Dr Ross Crawford (not in picture) operates on a cadaver during a two-day specialised course on Cadaver Hip Arthoplasty at AIIMS in New Delhi. The photograph has been used here for repre-sentational purposes, gesturing at the need for insurance players to take a lesson or two in taking caring of their customers. ARIJIT SEN / HT PHOTO

■ A World Bank study claims that 99% of Indians will face financial crunch in caseof any critical illness, underlining the need for health insurance. THINKSTOCK

CUSTOMERS’ VERDICT: THE BEST COMPANIES

( )The four state-owned

general insurance companiesare looking to engage a thirdparty administrator to ensure

that customers are not put throughany major trouble

NSR CHANDRA PRASAD

Emphasis has to be on consumerawareness and satisfaction,

provision of quality health care,improved insurance services andgreater collaboration between

insurers and healthcare providersAM I T M I T RA

TIME LAG Experts say that claims settlement takes longer in NIC compared to its competitors

SAMPLE SIZE: A TOTAL OF 2074 MEDICAL INSURANCE HOLDERS FROM 8 CITIES SATISFACTION WITH CUSTOMER SERVICING WAS MEASURED USING 6 DIMENSIONS

GRAPHICS: PRASHANT CHAUDHARYHigher figure indicates greater satisfaction level

14 | business | HINDUSTAN T IMES, MUMBAIMONDAY, MARCH 28 , 201 1

HT Correspondent■ letters@hindustantimes.com

NEWDELHI:While the to-go-or-not-to-go-the-cashless-way debate continues torock the insuranceboat, choppywatersnotwithstanding, a few insurance firmshave managed to ensure steady claimprocessing for their clients.Tata AIG bagged second place in

claim settlement satisfaction, accord-ing to a Hindustan Times-MaRS sur-vey of health insurance firms.“We had not stopped accepting

claims evenwhen the controversy overcashless hospitalisation was on lastyear,” explained Gaurav Garg, manag-ing director, Tata AIG.The impasse over cashless hospital-

isation began in July last year whenalleging over-billing byhospitals, state-owned general insurance companieswithdrew the facility of cashless treat-ment.Now, this step would have made lit-

tle difference even in 2006, when theinsured revenue was less than 10% ofhospital billing.But since then thehealthinsurance market has consistentlygrownat a 40%CAGR, as stated by theConfederationof Indian Industry report,andnaturally the implications arehuge.According to the industry average,

settlement ratio of the industry is about65-75% for individual policies and 100%for group insurance policies.Many companies offer group health

insurance policies to their employees.Group insurance premium comes at afractionof individual policies, anddress-

es up the package nicely while beingeasy on the employer’s pocket.While an individual policy of a cover

of R2 lakhcould cost about R3,000annu-ally for a 30-year old person, a groupinsurance cover for the same personwould barely cost his employer a fewhundred rupees.Lately, insurance companies have

quietly raised premium rates allegingthat hospitals have been inflating billshurting their bottomlines.Non-life insurance companies have

also started charginghigher premiumsfromcorporationsofferinggrouphealthinsurance to their employees. In thelast fewmonths, group insurance pre-miums have gone up by about 25%.To keep costs under control some

companieshavealreadystartedrestruc-turing health insurance benefits, suchas curtailing benefits for dependants,offered to employees.“To keep costs in control from this

year onwards any cover for additionalbenefits to dependent parentswill haveto be borne by the employee,” saidthe human resources director of oneof India’s largest information technol-ogy companies, who did not wish tobe identified. In fact, not being presentin group insurance may have helpedTata AIG.AlthoughGarg says, “Thoughweare

not present in group insurance at themoment,wemay consider entering thesegment inwakeof the free pricingpol-icy.” But for all the insurance playersout there, the expert advice seems tobe: ironout outstanding issuesbetweenhospitals and insurance firmsandworkonbetter servicedeliveryandcustomersatisfaction.Gopal Verma, director, e-Meditek, a

third party administrator, says, “Insu-rance firmsmustwork towards havinga framework to settle claims within aweek to ensure that customers do nothave to go through uncertainty.”Like they say, healthy, wealthy and

wise.

INDIA’SBESTMEDICALINSURERSuser’schoice

HT Correspondents■ letters@hindustantimes.com

NEW DELHI: As public sector insurerspow-wowedwith hospitals, private sec-torplayersmadehay.Most of themcon-tinuedwith cashless claims andgainedsteadily, at least in terms of customerperception.ICICI Lombard was rated the best

in the area of customer satisfaction bythe HT-Mars survey. “We did not dis-continue with cashless hospitalisationat any point,” said Sanjay Datta, head,customer service, ICICI Lombard.The company’s premium fromhealth

insurance in 2010-11 was R1,000 crore,an increase of about 20% over the pre-vious fiscal.According to a report by the

Comptroller and Auditor General ofIndia, the private sector general insur-ance players are estimated to garner

health insurance premium of R30,000crorewithin 2015, almost thrice the cur-rent premium.The same report also suggested that

though the health portfolio was grow-ing at a phenomenal rate, PSU insur-ers were losing their market share toprivate sector companies.Despite growth in the volumeof busi-

ness PSUs continued to incur losses.And the losses incurred had much todowith the lack ofmonitoring in groupmediclaim policies.What especially seems tohave tipped

the scales in favour of ICICI Lombardis the speedof settlement—sevendaysin all.Says Datta, “We settle claims with-

in a defined period of time andbesides,we keep the customer informed aboutthe status of the claim settlementprocess and naturally our customerswant to stay with us.”

ICICI’s USP: Speedydisbursement of claims

Star shines brighestin claim settlementHT Correspondents■ letters@hindustantimes.com

NEWDELHI :When it comes to claim set-tlement, private insurance companiesare perceived to be better than theirpublic sector counterparts, reveals thefindings of theHindustanTimes-MaRSsurvey.Respondents to the survey ranked

India’s first stand-alone health insur-ance company, Star Health & AlliedInsurance Company, as the best interms of settlement of mediclaim poli-cies.Health insurance in India covers

around 11% of the population, accord-ing to the latest Comptroller andAuditor General (CAG) report.But low penetration notwithstand-

ing, health insurance is themost soughtafter portfolio next only to motor

insurance.And as Gopal Verma, director, e-

Meditek, a third-party administrator(TPA) points out; stand-alone healthinsurance companies will play a criti-cal role in the domestic market toincrease penetration.“Star Health & Allied Insurance

Company along with a few other com-panies have a singlewindow clearancemechanism which reduces the settle-ment to less than aweek,” said Verma.Industry experts said that once the

regulatory issues including the foreigndirect investment (FDI) norms areaddressed, several more standalonehealth insurance companies will forayinto India.

The Insurance Amendment Bill,that is pending in Rajya Sabha, seeksto enhance the cap on FDI in privateinsurers from the current 26% to 49%.

WHAT HAPPENED In July 2010, PSU insurers stoppedcashless treatment alleging over-billing by hospitals

Cashless offerhelpedTataAIG score

The study was carriedout in eight major citiesof India — Delhi,Lucknow, Kolkata,Mumbai, Ahmedabad,Chennai, Bangalore andHyderabad.The study team was ledby Vishal Ramchandani(vishal@marspvt.net).A total of 2074 medicalinsurance holdersconstituted the totalsample size across 8cities for 15 medicalinsurance companies.The sample spread bythe insurance compa-nies are given below.

CCuussttoommeerr ssaattiissffaaccttiioonn oonn ccllaaiimmsseettttlleemmeenntt was measured using sixattribute parameters — contactibility ofsurveyor/TPA, surveyor/TPA respon-siveness, surveyor claim processknowledge, procedure/paperwork forclaim settlement, speed of service/timetaken in claim settlement, and deliveryof promised services in the policy.

CCuussttoommeerr ssaattiissffaaccttiioonn oonn ccuussttoommeerrsseerrvviicciinngg aanndd iinntteerraaccttiioonn was carriedout using six dimensions — productenquiry stage, purchase transaction,policy issuance, hospital network,renewal, and transparency.Weights used for each of the sixdimensions to arrive at the aggregatescore on customer interaction was:Product enquiry stage 12%

Purchase transaction 15%Policy Issuance 16%Hospital Network 21%Renewal Process 12%Transparency 24%

Each customer interaction dimensionwas measured using a 2-6 attributeparameters, for a total of 27 attributeparameters, as given below.PRODUCT ENQUIRY — Five attributes:Detailed information provided, specifi-cation of documentation, process ofpurchasing explained, and speed ofservice.PURCHASE TRANSACTION — Sixattributes: Ease of purchasing thepolicy, detailed product information,transparency in transaction, courtesyand politeness, willingness of staff to

answer queries, Speed of service/transaction.POLICY ISSUANCE — Five attributes:Timely receipt of documents, intimationof policy status, speed of service, sim-plicity of procedure for issue of policy,and attitude of company’s agents.NETWORK — Two attributes: Hospitalnetwork - quality of hospitals,hospital network - number of tie-upsRENEWAL— Five attributes: Timely inti-mation of renewal, timely receipt ofrenewal notice, ease of renewing thepolicy, timely renewal, receipt of policydocuments, and speed of service.TRANSPARENCY— Four attributes:Clarity on diseases covered, clearlystated policy wordings, regular productupdates, transparent no claim bonuscredits.

METHODOLOGY

FOR ALL INSURANCE PLAYERSTHE EXPERT ADVICE IS: IRONOUT OUTSTANDING ISSUESBETWEEN HOSPITALS ANDINSURANCE FIRMS ANDWORKON BETTER SERVICE DELIVERY

Brand Sample sizeApollo Munich 106Bajaj Allianz 191Bharti AXA 112Cholamandalam MS 41HDFC Ergo 145ICICI Lombard 198Max Buppa 23National Insurance 206New India Assurance 181Oriental Insurance 168Reliance Gen Insurance 174Royal Sundaram 71Star Health & Allied 135TATA AIG 158United India 165

2074

KolkataDelhi Mumbai Chennai

760

762 756 756 754 751

760 760 758 754 752

756

754

752

750

Star Health& Allied

Star Health& Allied

TATAAIG

TATAAIG

TATAAIG

Reliance GenInsurance

Reliance GenInsurance

Reliance GenInsurance

ICICILombard

ICICILombard

ICICILombard

NationalInsurance

NationalInsurance

768

746

737

724

722

United India

United India

United India

United India

OrientalInsurance

OrientalInsurance

OrientalInsurance

TATA AIG

TATA AIG

TATA AIG

TATA AIG

TATA AIG Star Health

Star Health& Allied

HDFC Ergo

HDFC Ergo

ICICILombard

TATA AIG

BajajAlliance

BajajAlliance

BajajAlliance

BajajAlliance

HDFC Ergo

Reliance GenInsurance

Reliance GenInsurance

Reliance GenInsurance

Reliance GenInsurance

NationalInsurance

NationalInsurance

NationalInsurance

New IndiaInsurance

New IndiaInsurance

New IndiaAssurance

New IndiaAssurance

New IndiaAssurance

New IndiaAssurance

New IndiaAssurance

ICICILombard

ICICILombard

ICICILombard

BhartiAXA

820

783

782

779

757

822

784

784

778

759

723

717

698

694

687

842

835

831

828

819

Star Health& Allied

Star Health& Allied

Star Health& Allied

735

735

713

710

709

736

729

704

702

677

870

818

815

794

782

HyderabadBangalore Ahmedabad Lucknow

Star Health& Allied

TATA AIG

Reliance GenInsurance

ICICILombard

NationalInsurance

766

763

762

755

754

Star Health& Allied

TATA AIG TATA AIG

Reliance GenInsurance

ICICILombard

ICICILombard

NationalInsurance

NationalInsurance

756

751

748

741

737

755

757

750

746

744

CUSTOMERS’ VERDICT: THE DEFINITIVE GUIDE TO THE BEST SERVICE PROVIDERS ACROSS INDIA

Eight cities give their verdict on the best medical insurers

Customer satisfaction oninteraction at productenquiry level — Top5 companies

Customersatisfactionon interactionat purchasetransaction— Top 5companies

Customersatisfactionduring policyissuance —Top 5companies

Customer satisfaction on interactionduring renewal — Top 5 companies

Customer satisfaction onhospital network —Top 5 companies

Customer satisfaction onperceived transparency of thecompanies — Top 5 companies

GRAPHIC: PRASHANT CHAUDHARYHigher figure indicates greater satisfaction level

| business | 15HINDUSTAN T IMES, MUMBAIMONDAY, MARCH 28 , 201 1