The common third-party administrator, Health Insurance TPA of India, floated by the four public sector general insurers and the national re-insurer for processing health insurance claims, is likely to be operational by April, 2015.
The promoters of the TPA are — New India Assurance, Oriental Insurance, United India Insurance, National Insurance and General Insurance Corporation (the national re-insurer). Insurance companies use a third-party administrator to manage claims processing, provide networks and facilitate cashless service at the time of hospitalisation.
Heath Insurance TPA received licence from the insurance regulator recently and is looking to recruit people for various positions, said a senior official of the company.
While the external third-party administrators that service the four public sector general insurers will continue to do so, Health Insurance TPA will start off with a small portion of the insurers’ overall business.
The four insurers control 70 per cent of the over ₹15,000 crore health insurance market.
But they are making underwriting losses as the claims ratio is around 120 per cent, particularly in the group health portfolio.
Currently, insurers outsource the claims settlement process to third-party administrators.
However, their experience in this regard has been unsatisfactory. Insurers feel that the move to settle claims through their own administrator will enable them to check fraudulent claims, resolve disputes and settle claims faster.
Each of the four state-owned insurers has contributed to the total seed capital of ₹200 crore.