Health Insurance Policies for Senior Citizens

On 8th May 2013, Business Standard carried a news feature on Health Insurance Policies, titled ‘Senior citizen policies need to be pushed’:

[Business Standard – 8th May 2013]

The four public sector insurance companies have decided to introduce age-based commission structure for their agents. In other words, policies sold to senior citizens will attract less commission as compared to policies sold to younger people. According to the plan, public sector insurers will pay a commission of only ten and five per cent on policies sold to people over 40 and 60 years. As against this, policies sold to those below 40 years can fetch the agent commission up to 15 per cent.

According to Insurance Regulatory and Development Authority (Irda) guidelines, there is a commission ceiling of 15 per cent for agents and 17.5 per cent for brokers who sell health insurance policies.

The reason for this move is because insurance sold to senior citizens increases claims and the insurer’s loss ratio, in-turn increasing their expenditure on servicing such policies, explains an official from United India Insurance.

So, despite the Irda asking insurers to extend the entry age for health insurance to 65 years, very few insurers actually allow senior citizens to buy health covers at that age.

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