The claims ratio of health insurance segments have fallen to FY19 levels after a spike during the peak of the Covid-19 pandemic. The net incurred claims ratio of health insurance business dropped to 89% in FY23 as compared to 109% and 94% in FY21, data from the Insurance Regulatory and Development Authority of India’s (Irdai) annual report 2022-23 show.
Death claims from life insurance came down 32% to Rupees 41,457 in FY23 from Rupees 60,822 crore in FY22.
Segment-wise, the net incurred claims ratio of individual health businesses came down to 76% in FY23 from 96% in FY23. For group business, it fell to 96% from 119% during the same period.
The gross direct premium (within India) of non-life insurers grew 16.4% to Rupees 2.6 trillion in FY23 as compared to Rupees 2.2 trillion in FY22. The premium underwritten from Health (including personal accident) grew 21% year-on-year to Rupees 97,664 crore in FY23 from Rupees 80,502 crore in FY22.
The health segment accounts for 38% of the total premium of general insurers. Five states —Maharashtra, Karnataka, Tamil Nadu, Gujarat and Delhi — contributed about 64% of the total health insurance premiums in FY23. During FY23, general and health insurers paid Rupees 70,930 crore for 23.6 million health insurance claims. The average amount paid per claim was Rupees 30,087.
Two-thirds of the claims were settled through Third Party Administrators (TPAs) and the rest were settled through in-house mechanisms.
The annual report, citing data from Swiss Re Sigma Report, says that India’s overall insurance penetration dropped to 4% in 2022-23 from 4.2% in FY22. The same from life insurance dropped to 3% from 3.2% during the same period. For general insurers, it remained stagnant at 1%.