- Awareness among people due to COVID
- Signs of recovery in motor insurance
COVID While many sectors were affected due to the pandemic, the growth of many also accelerated. The general insurance sector is one such sector, in which the growth of the motor insurance segment was affected, but the growth of the health insurance segment accelerated. Due to costly treatment, awareness came among the people and now people are getting motivated to take Mediclaim policy and increase the coverage of their existing policy. In this regard, the Managing Director and CEO of leading insurance company Kotak Mahindra General Insurance Company Ltd. Suresh Agarwal From Vishnu Bharadwaj Conversed. Suresh Agarwal, a Chartered Accountant, Company Secretary and Cost Accountant, has over 26 years of rich experience in the insurance industry. Here are the highlights of the conversation
What is the impact of the COVID crisis on the growth of the general insurance market?
It is such that insurance is such a financial instrument, which reduces your financial risk. I believe the pandemic has rightly taught us how important it is to have a good insurance policy with adequate cover to mitigate the financial risks. Earlier, many people especially in small towns, who knew about health insurance but never used to take it, due to the COVID pandemic, awareness has also come among them and they too are now buying mediclaim. Insurance companies are also using technology to attract these customers. Hence the health insurance segment has registered a rapid growth of 30-40 per cent. Now motor insurance is also showing signs of recovery.
Is privatization in the interest of the industry or will it create problems?
Privatization is only in the interest of the industry. We have seen this over the years. Privatization has accelerated the growth of the insurance sector in the country. Privatization means more competition, more products, more choices for customers, innovative distribution channels and massive job creation. At the same time, awareness about insurance and penetration of insurance will also increase, which is much needed. The increasing competition in any sector always benefits the customers.
Now that economic activities have started returning to normal with the Covid crisis subsiding, do you think motor insurance will pick up?
The motor insurance business was affected in the financial year 2020-21 due to the Covid crisis and the lockdown, but now the sales of cars have started increasing gradually and we are also seeing some good signs in this segment. So we expect the motor insurance business to pick up. I am sure there will be a lot of innovation in this area as there will be a shift in mobility and the way we travel daily.
Do you think a comprehensive health insurance is the need of the hour?
It is such that Apna Desh is one of those countries in the world where the penetration of health insurance is very low. Some studies show that India has one of the highest spending rates on treatment and treatment is also expensive. In such a situation, it has become necessary for everyone to take a comprehensive coverage health insurance policy for their family, so that in case of any major illness, they can be free from the worry of treatment expenses.
What advice would you give for maintaining good health insurance habits?
First of all, I would like to say that health insurance should be done by every person. If you don’t have it, buy it soon. The sooner you take health insurance in life, the better. Because with age the premium increases and at the same time the chances of going to the hospital also increase. Choose the ‘Sum Insured’ that is enough for you. The ‘sum insured’ of Rs 5 lakh may become insufficient after 10 years, so think far. And never let your mediclaim policy lapse, always renew on time and stay safe.
How many claims did Kotak Mahindra settle during the second wave of COVID? Will this figure increase or decrease in the near future?
The impact of the second wave was more severe than that of the first wave. During April to June 2021, there were a large number of health insurance claims. Although there are no signs of further deterioration, we have to keep in mind the possibility of a possible third wave. So we are keeping an eye on it.