Manipal Cigna seeks 30% growth in health insurance: CEO Prasun Sikdar

High claims for Covid-19 a challenge for the industry, says the senior executive

Health insurance appears slowing due to the base effect and waning demand. Prasun Sikdar, managing director and chief executive officer of Manipal Cigna Health Insurance, spoke to Subrata Panda about health insurance and the company’s plans.

Here are edited excerpts from the interview:

How has the company done in terms of business in Q1?

In the April-June quarter, growth for Manipal Cigna Health Insurance stands at 36 per cent while the overall health insurance industry’s gross written premium has grown by 21 per cent, and the standalone health insurers (SAHI) in the country reported a 29 per cent. growth.

The health segment, especially the retail health segment, seems to have slowed down. What is the reason?

Historically, despite health insurance being a living benefit product, it continues to be somewhat a push product. However, the pandemic outbreak brought some inevitable changes, but as the fear of pandemic subsides, the industry appears to be slowing down again in the retail health segment. Also, high Covid claims experience is another big challenge that industry is facing, and it is impacting the overall loss ratio of insurers. Nonetheless, in a relatively uninsured and under-insured market like ours, the demand and growth for health insurance is likely to boost going forward.

 Group business is driving the health insurance business currently because price revision happened in that segment. So, is there a need to revise premiums in the retail health segment too?

 Premium revision in any segment of the business, either group or retail is predominantly linked with medical inflation which in turn is a function of several factors like rising costs, new advances in medical treatments, technologies etc. These factors are ever present in a growing economy and hence will continue to impact the health insurance premiums as every insurer revises the price periodically for each product.

Though price revision for retail business is not very frequent, as the portfolio takes some time to mature for calculation of performance indicators. However, Covid has brought about a multitude of changes in the treatment protocols, which in turn have also impacted the costs. If these changes are permanent, then these factors could also impact the premiums in the retail health segment in the long run.

IRDAI (the insurance regulator) has given some indicative growth targets to insurers for the next 5 years. Is the target feasible?

 The healthcare costs are on a continuous rise, but India is one of the least insured countries with a low insurance penetration rate. IRDAI’s targets for insurers is certainly a positive measure to ensure higher health insurance penetration. We believe the growth targets given for the next five years are feasible, but it will also depend upon the capital and risk appetite of insurers.

What will be the focus areas of the company this year?

We will continue to maintain a sharp focus on the health needs of our customers, to adapt to the digital era, deliver a top-notch customer experience and continue to drive growth by building strong retail business through our new products so that we can achieve our long-term objective of sustainable and profitable growth calibrated for risk, cost, and quality.

 How are you planning to increase your market share?

With the changing business dynamics and proposed regulatory changes, many more new distribution avenues are likely to be opened i.e., corporate agency tie-up will be available up to 9 SAHIs instead of the current limit of 3 players, this will give us an opportunity to add new distribution and drive higher growth to increase our market share.

What is the growth target for the company?

In the current year (FY23), we are targeting growth of around 30-35 per cent.

Is the company looking to come out with any new products this year?

Recently, we launched ManipalCigna ProHealth Prime to cater to the outpatient department (OPD) and impaired health segments. Our internal research revealed that customers are spending a large part of their healthcare expenses, so we took the first step by launching an inpatient department cum OPD proposition. For impaired health segment, which is largely deprived of health cover, we have launched a customizable product ManipalCigna ProHealth Prime Active which caters to this segment, so that customers suffering from diabetes, hypertension, cholesterol, obesity, and asthma can now avail health insurance where the coverage starts from 91st day onwards.