Your neighbourhood LIC agent (or any other insurance agent for that matter) may soon be able to sell an array of health insurance plans and mediclaim policies, giving you the freedom to choose from a host of products. Currently, a health cover agent is hard to come by, and the options available with him are limited — they being that of a particular company. Things are in for a change.
The panel set up to look into senior citizens’ health insurance aspects has suggested convergence of agents for health insurance plans. This means that agents of any insurance company — private or public, or life or general — can sell health cover plans of any other company. In effect, the agent will be a broker of all health insurance plans available in India.
Currently, an agent can sell policies of only that particular company with which he is attached. The move to allow an agent to sell policies of all companies “will bring in more competition and prices are expected to come down,” said an official. “It is also expected to increase penetration of health cover in India, which is now abysmally low,” he added.
At present, the insurance industry (comprising both life and non-life), has about 30 lakh agents, all tied up with a particular company or the other. Hence, the options these agents offer are limited. If the recommendation becomes a law, each of the 20 lakh life insurance agents and 10 lakh general insurance advisors will be able to sell health plans from 17 general insurance companies and 16 life insurance companies.
However, not all life insurers have started selling health insurance policies. The largest life insurer, Life Insurance Corporation of India, which has about 13 lakh agents, has just announced plans to offer health insurance plans. It is working on products which are expected to hit the market in the next couple of months.
Many private life insurers have already started launching health plans. Bajaj Allianz Life Insurance is looking at a Rs 500-crore turnover from its health insurance business in 2007-08. Officials feel that the question of an agent pushing a particular policy, which gives him the highest commission, does not arise as most insurers are already paying a commission of 15%, the highest allowed.
However, some companies have reduced the commission for policies sold to senior citizens. “With a health insurance pool for senior citizens being proposed, losses from this segment are likely to decline drastically,” said an industry analyst. Every insurer will contribute an amount to this pool and will be eligible to withdraw from it in case they incur losses.
Press release:Economic Times
Source: http://blogs.medindia.net/one-agent-all-companies-all-covers-insurance-agents-get-a-makeover/
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