NEW DELHI: All four general public sector insurance companies are in the red, mainly due to losses of over Rs. 26,300 incurred in their healthcare portfolio in five years from 2016-17 to 2020-21, a report by the Comptroller and Auditor General (CAG) from India revealed.
In his report submitted in houses of Parliament On Friday, the CAG said the losses were caused by group insurance policies, where the premium was lower and the claim outcome was higher compared to retail policies. The exam covered New India Insurance Company Limited, United India Insurance Company Limited, Oriental Limited Liability Insurance Company and National Limited Insurance Company and put their combined losses at Rs 26,364 crore.
About 10 years ago, PSU insurers took the initiative to build their own network of hospitals by creating a Preferred Provider Network (PPN). It found that the four PSU insurers combined have PPN agreements with just 2,552 hospitals (vs. 9,900 hospitals for Star Health Insurance Co. Ltd and 10,000 hospitals for HDFC Ergo General Insurance Co. Ltd). “This indicates insufficient efforts by PSU insurers to connect to a larger number of hospitals,” the auditor said.
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