Non-life insurance companies will get a boost in their business with Finance Minister Pranab Mukherjee proposing to increase the budgetary allocation for Rashtriya Swasthya Bima Yojana (RSBY) by 40 per cent to Rs 350 crore in the Budget 2009-10.
RSBY was launched to provide health insurance for BPL families for illnesses that involve hospitalisation. More than 46 lakh BPL families in eighteen States have been covered in the last two years.
Says Sanjay Pande, executive director, Amicus Advisory, “Half of the industry’s incremental growth is coming from health insurance. With RSBY having increased the allocation to Rs 350 crore, it will roughly be about 5 per cent of last year’s health premium.”
Says Rakesh Jain, CFO & director — corporate, ICICI Lombard General Insurance, “We are targeting a revenue of Rs 350 to Rs 400 crore from RSBY. We want to cover 50 lakh families in UP and 3 lakh families in Maharashtra.”
The RSBY beneficiary pays an amount of Rs 30 as registration fee to the insurance company. The Centre pays 75 per cent of the premium while the State government pays the remaining 25 per cent. The insurer is selected by the State government on the basis of a competitive bidding.
The maximum premium fixed ranges from Rs 500 to Rs 750 per family per year.