We are in the Business of Paying Claims

[Apollo Munich CEO]

Antony Jacob, CEO of Apollo Munich Health Insurance believes that a
robust IT platform and knowing details of the customer at the proposal
stage helps reduce chances of claims rejection later. In an interview
with Ritu Kant Ojha of The Indian Express, Jacob says, "We are in the
business to pay claims". Excerpts:

You are a fairly new player with 3 years in the health insurance
market. How has the journey been for last 3 years?

During the financial year 2011-11, Apollo Munich has garnered Rs 283
crores of GWP compared to Rs 114 crores in the year 2009-10,
signifying a growth of 148 per cent compared to the last financial
year. We have has insured over 27 lakh lives in the country.

Health insurance distribution has been challenging in India. How does
a health insurance agent with a 15 per cent commission compare with
the 30 per cent commission of a life insurance agent?

Yes, I believe that health insurance distribution has been a challenge
till date. With the health insurance premium expected to grow at a
compound annual growth rate of over 25 per cent for the period
spanning from 2009-10 to 2013-14, this challenge does seem to be
waning. All emerging trends clearly point to the fact that the Indian
health insurance market is the new and lucrative growth avenue. The
projected growth makes health insurance an attractive proposition for
agents. Life insurance clearly constitutes a dominating share in the
total insurance pie and has more sales persons promoting it, but I
think what remains lesser known is that health insurance has the
benefit of attractive commissions spanned equally over the life span
of an agent.

Settlement of claims has always been an issue with health insurance
companies.

At Apollo Munich, we believe that we are in the business to pay
claims. At the same time, we have an obligation to our shareholders to
ensure that we pay genuine claims and have enough checks and balances
in place to repudiate non-genuine claims. We have a robust IT platform
and strong provider relationships to minimise such cases.

Ultimately, we also believe that if we very clearly explain to our
customers what is covered and what is not and the circumstances under
which claims are paid, we will be in a position to pay every single
genuine claim.

What are the fine prints one must look at while buying a health
policy?

We advise health insurance buyers to take special notice of the
following tips before signing on a policy: fill up proposal form
yourself, know the exclusions, and read policy wording.

What is your break even point? Are you looking at raising long term
capital through FDI if the cap is raised?

I believe the health insurance business usually breaks even between
the 5th and the 7th year of operations and we are on track to achieve
the same. On the need for capital, our shareholders are committed to
fund the growth plans of our company in line with the IRDA
regulations.

There is a mandatory clause of rural sector obligations for the
insurance companies. How is Apollo Munich doing on that front?

Apollo Munich has participated in a few micro insurance projects, but
to enter the rural insurance sector in a big way, we are trying to
build our understanding of the requirements and the challenges of the
sector.

In the last couple of years we have participated in the RSBY Meghalaya
and Maharashtra project to get an experience of the issues and garner
thorough knowledge of the needs of the rural folks. May be in a year
or two we will be focusing more on the rural segment based on our
experiences.