Sixty-three year old Lalit Kiran Dev got a shock when he went to Oriental Insurance Company’s office to renew the mediclaim policy he had bought a few years ago. The public sector non-life insurer had raised his renewal premium by 100 per cent and that too without any prior notice!

“Take it or leave it,” said the officer when Dev inquired about the arbitrary hike in the premium.

Are you stunned by the attitude of public sector insurers to elderly people? Here’s more. There are four public sector general insurance companies and they account for 80 per cent of the voluntary commercial health insurance business in the country. Some of them have devised a commission policy that discourages agents to sell mediclaim plans to people above 60.

Last August, public sector general insurers and some of their private counterparts told their agents they would get a 15 per cent commission on health covers sold to people aged 45 years or below, but they won’t get any commission on those sold to individuals of 55 years or more. For mediclaims sold to people in the age group of 45 to 55, agents will get a commission of 10 per cent.

So, if you are on the odd side of 60, chances are you won’t easily get a medical insurance and even if you do, the cost would be high.

Double whammy

Take the instance of Oriental Insurance Company. From September this year, the insurer has doubled the premium cost for health covers for senior citizens — both for fresh policies as well as renewals. A person aged between 61 and 70 would have to pay a premium of Rs 10,018 to buy a medical insurance with a sum assured of Rs 2 lakh. The pre-September premium rate varied between Rs 4,458 and Rs 5,009 depending on the age of the insured.

“How can a retiree pay Rs 5,000 plus as premium for a medical cover of Rs 1 lakh?” a perplexed Dev asks.

Renewal wrangle

Public sector insurers have also started altering the terms for policy renewals for senior citizens. Let’s look at the Varishtha Mediclaim launched this month by National Insurance Company (NIC) for people between 60 and 80. This plan provides two types of cover — mediclaim (a cover for hospitalisation and domiciliary charges i.e. expenses for treatment at home) under section I and critical illness cover under section II. The sum assured under both the sections are fixed — Rs 1 lakh for mediclaim and Rs 2 lakh for critical illness.

If you are in the 60-65 age bracket and already hold a mediclaim policy from National Insurance Company, you can pay a total premium of Rs 6,187 for the mediclaim and critical illness cover together under the Varishtha Medical plan. You can also opt for mediclaim only and pay a premium of Rs 4,180. But note that NIC charges a premium of Rs 2,322 only for a cover of Rs 1 lakh under its Mediclaim policy for the same age group.

Cover refused

In practice, the low premium is availed of only by existing policyholders of Mediclaim on renewals. If an individual aged 60 and above wants a Mediclaim policy for the first time, the company is reluctant to offer the person the policy as the risk is high and the premium rate low. The Mediclaim plan, however, states that individuals up to a maximum age of 75 can buy a fresh policy.

The Varishtha plan comes with a higher premium for the mediclaim component. If Varishtha Mediclaim is the first health plan purchased from NIC, you will have to pay a 10 per cent extra premium.

Co-payment clause

National Insurance has added a clause of co-payment of medical bills (total claim amount) by the insured. Under the Varishtha Mediclaim plan, the insured will have to pay 10 per cent of the medical bill. However, if the insured undertakes to pay 20 per cent of the bill, he or she would get a 10 per cent discount on premium.

Sub-limits set

Another feature of the Varishtha Mediclaim, which is a pointer to a future trend in all mediclaim policies irrespective of the insurer, is the introduction of sub-limits on expenditures under different heads, such as room rent during hospitalisation and surgeries.

Private insurers follow suit

Private insurers have also started offering their medical insurance plans exclusively to senior citizens, but the premium here again is too high. For example, Bajaj Allianz General Insurance Company’s Silver Health Plan charges a premium of Rs 11,203 for a cover of Rs 2 lakh for people between 61 and 65 years. Though the plan is offered to people between 45 and 75 years, individuals up to a maximum age of 60 only can buy this plan. However, it can be renewed up to the age of 75.

Pre-existing pain

All these plans, however, do not give seniors any respite from their existing aches and pains. Pre-existing diseases can be included in the cover by paying an extra premium. But again, not all diseases can be included.

In both the Varishtha Mediclaim and Silver Health Plan, pre-existing diseases will be covered only after one claim-free year from the commencement of the policy. In NIC’s plan, hypertension and diabetes can be covered from the commencement of the policy, but the insured will have to pay a 20 per cent extra premium. The cost of healthcare and medical cover is going up. Buy your medical insurance plan at a younger age instead of waiting till retirement.