Monday, September 26, 2016

Health Insurance – For protection of Health but of WHOM????

Letter received from Shri R K Pathak , our google group member , on the above subject is reproduced below.

Health Insurance – For protection of Health but of WHOM????

As per the 10th bipartite settlement signed on 25/05/2015, IBA introduced Group Health Insurance Scheme for Employees in Service as well as for retirees with cover of 3 lacs for award staff and 4 lacs for Officers.
The Insurance premium charged for cover of 3 & 4 lacs for retirees was of Rs.4930 and 6573 excluding service tax and policy became in operation from 1/11/2015 to 31/10/2016.
The almost 11 month’s period is lapsed and still IBA is yet to decide the issue of “Domiciliary Treatment” which was agreed in settlement and now policy is due for renewal.
The Group Health Insurance Policy of in service Employees is due for renewal on 1/10/2016 and UIIC was expected to renew the policy without increasing the premium. But now UIIC has intimated the IBA vide their communication dated 15/09/2016 that revised premium from 01/10/2016 will be as under:-
Amount Insured
Previous Premium
Revised premium
Increase in Amount
Increase in %
Award Staff
Rs.3.00 lacs
Rs.4930+ Tax
10452 + Tax
Rs.4.00 Lacs
Rs.6573 + Tax
Rs.13935 + Tax

The UIIC has increased the premium by 112% which is not in accordance with the policy document and condition stipulated at clause 5.18 which reads as under:-
Subject otherwise to terms and conditions of Group Mediclaim Policy as attached. The Insurance Company agrees for a continuity cover for three years based on the following annual renewal matrix. Claims Ratio
Claims Ratio
Discount/ Loading Percentage to be applied on the base premium
Not Exceeding 25% 40% discount
Not Exceeding 30% 35% discount
Not Exceeding 40% 25% discount
Not Exceeding 50% 15% discount
Not Exceeding 60% 5% discount
61% - 110% No discount no Loading
111% - 115% 5% loading
116% - 120% 7% loading
121% - 125% 10% loading
126% - 130% 13% loading
131% - 135% 15% loading
136% - 140% 18% loading
IBA immediately responded UIIC over revised premium referring the agreed clause 5.18 in the policy, vide their communication dated 17/09/2016 but UIIC did not concede to the request of the IBA as claim ratio has reached 180 to 190% for which loading matrix was not provided in the Policy and became firm on 112% increase in the premium.
As the policy is due for renewal on 1/10/2016 for in-service employees and as IBA has advised to Bank of revised premium on 22/09/2016 [copy attached] and as the insurance premium has to be paid in advance, Member Banks will have to accept this unreasonable rise in the premium and will be making payments to UIIC contrary to the terms of Policy.
Neither Bank Management NOR UFBU leaders will raise any voice on the dictating terms of UIIC & IBA as in service employees premium is borne by Bank and Board of the Bank is not accountable to GOI for accepting this unreasonable term by debit to Banks profit, which is already shrinking.
The real problem is ahead as the policy for retirees is due for renewal on 1/11/2016 and premium has to be paid by retirees, POOR retirees will have to accept this unreasonable premium which is not only exorbitant but equal to / double of their monthly pension / family pension and acts of UIIC / IBA and Bank raises doubt that whether the policy is implemented to protect the life of Retirees or to destroy them with a view to remove them from members of Pension fund????.
Attention is invited of ALL CONCERNED to terms and condition of policy document which is as under:-
“The Company may revise any of the terms, conditions and exceptions of this insurance including the premium payable on renewal in accordance with the guidelines/rules framed by the Insurance Regulatory and Development Authority (IRDA) and after obtaining prior approval from the Authority. We shall notify you of such changes at least three months before the revision are to take effect. The Company may also withdraw the insurance as offered hereunder after following the due process as laid down by the IRDA and after obtaining prior approval of the Authority and we shall offer to cover you under such revised/new terms, conditions, exceptions and premium for which we shall have obtained from the Authority.”
1)      Does the act of UIIC / IBA to give 10 days’ notice for enhancing premium falls within agreed clause 8 as referred above?????
2)      Does the 112% increase in premium for renewal falls within agreed clause 5.18 as referred above?????
3)      Does the act of UIIC is in accordance with IRDAI (Health Insurance) Regulations 2013 and IRDAI Protection Policyholders’ Interest) Regulations 2002 / 2014 as amended from time to time as agreed at clause 6 of the policy document?????


The answer is reflected in the last para of the UIIC communication dated 22/09/2016,[copy attached] that prompted IBA to act promptly and the said para reads as under:-
“We also propose that if the loss ratio is kept under control and profit generated, if any, shall be shared equally".

Thanks & Regards

Pathak R K 


Note :- Author being resignee is not covered in the Health Insurance Policy by the Bank, Despite Policy Documents issued by UIIC covers the Resignee and 16 banks have extended the cover to this category. The views expressed are based on the contents agreed in the Policy and documents attached herein.
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  1. IS UIC IS A PUBLIC SECTOR INSURANCE COMPANY OR A LOOTING SECTOR COMPANY ? Are they not accountable for Unethical and Fraudulent practices as a service organization bound by the Consumer Protection Act.When IRDA is responsible to protect every citizen against exploitation by the Insurer company,how do they allow the UIC to dictate such inhuman rules at the very second year of its contract with another Public sector enterprise ? Even considering the Insuree as a very broad minded and liberal Indian Citizen,who is ready to pay an increased premium rate in the very second year of contract,he may pay an increase of the premium of only 40%,over the last year for the claim ratio of 180%,as per the chart given by UIC.If at all the UIC insists for 112% increase in the premium amount,as a benefeciary of the Health Insurance contract,the IBA SHOULD MAGNANIMOUSLY AGREE FOR ANY INCREASE IN THE PREMIUM AMOUNT FOR BOTH health cover policies of serving employees and retirees,as a goodwill gesture.

  2. The action of UIIC in fixing the renewal premium for Health Insurance Policies of Bank Pensioners are against the agreed settlement clauses and the unethical attitude of the UIIC should be condemned by all sectors. Being a Public Sector Insurance Company , how they can act in such a manner? The IRDA and IBA should intervene and find out a solution immediately otherwise large number of Bank Pensioners my decline to renew and in toto since the act of UIIV is unjustifiable.
    S. Thanikachalam, Retiree of Canara Bank, Gobichettipalayam.

  3. I simply believe like a lay man who soever pay the premium and irrespective of premium rate, the employee whether working or retired supposed to get the benefits of health care without fail.

  4. How to get out of this mess, should we write our respective Banks to not renew our policy or write to the Insurance company ? Please enlighten us !