Star Health and Allied Insurance is set to increase premium rates for certain individual health insurance plans, with an anticipated rise of approximately 15%. In February, the insurer raised premiums for its Family Health Optima (FHO) insurance plan, a popular product, by 25%.
Company officials clarified that the hike in FHO was the sole increase since the onset of pandemic. The products, currently under review for a premium adjustment, have not experienced arate revision for several years, they added. Distributors said Star Health has been known for its competitive pricing in insurance plans. The company is grappling after witnessing higher claims ratio in lower-value policies due to medical inflation. The company is realigning its growth strategy and concentrating on new distribution channels to enhance underwriting margins.
“We follow a risk-based pricing model, regularly evaluating all products. In the short term, we may consider revising prices for a few more products beyond Family Health Optima,” said Anand Roy, the company’s MD.
