)
The common in-house third party administrator (TPA) is expected to be operationalised by April 2014. This common TPA to process health claims will have expected to have National Insurance Company, New India Assurance Company, Oriental Insurance Company and General Insurance Corporation of India (GIC) as stakeholders.
This TPA will look into health claims and would handle majority of the claims received by the public general insurers. The common TPA has been proposed to prohibit large-scale leakages while settling insurance claims in the health segment.
According to industry players. it is expected to speed up the claim-settlement process as well as reduce the claims ratio of insurance companies. This move is also expected to reduce costs for these insurance players, who pay a commission of approximately 6% of premiums to TPAs to settle claims.
This common TPA would have each of the four public general insurers holding 23.75% stake each. GIC will hold 5% in the venture. This TPA is intended to process claims of public general insurers in-house, rather than being handled by an external agency.
Presently, most claims in the health segment are handled by external players, which increased the time taken to settle claims. PK Bhagat is the General Manager who is in-charge of the TPA, which will be based as a corporate entity in New Delhi.
According to industry players. it is expected to speed up the claim-settlement process as well as reduce the claims ratio of insurance companies. This move is also expected to reduce costs for these insurance players, who pay a commission of approximately 6% of premiums to TPAs to settle claims.
Once the TPA comes into operation, the claims handling and processing from external agencies will gradually be transferred to the new entity.
