In the beginning of March, when Dr Anil Kusnur (name changed), a Mumbai-based cardiologist, wanted to buy a high-value term insurance cover of Rs 5 crore, he decided to approach a leading private life insurer. The insurer asked him to go through several medical check-ups, which Kusnur did. He also submitted his proposal form, income proof and other documents promptly.
Of delays, disclosures and additional declarations
But the life insurer simply refused to revert on the proposal. “I got to know informally, through my intermediary, that the company was reluctant to take on the risk as I was treating COVID-19 patients. At best, they were willing to extend a cover of only Rs 1 crore, which was simply not adequate for me,” he says. In the process, he lost out on the chance to buy another term cover at cheaper premiums. This is because most life insurance companies raised their term insurance premiums from April 1, owing to pressure from global reinsurance firms. After he objected to the insurer’s stance, however, it has now restarted discussions with him on issuing the policy.
A Mumbai-based pulmonologist engaged with a private COVID-19 hospital, too, has seen his term insurance application being stalled. “Right in the beginning, while filling up the form, they asked for the disclosure on whether I was working or have any association with COVID care. Besides, they have been calling for some document or the other as part of their process. When I had a word with them to enquire whether the delay is linked to my disclosure, their reply was inconclusive. All I was told was that they were working on resolving the delay,” he says.
What’s more, it’s not just the ferocity of the second wave that seems to have increased risk perception of life insurers about doctors. Dr Prajwal Aran (name changed), an orthopaedic surgeon associated with a leading hospital in Mumbai had a similar experience last year in June 2020, at the height of the pandemic’s first wave. His term insurance application saw communication and processing delays, as also demand for additional tests and declarations. “I wanted to buy an additional term cover of Rs 2 crore, and approached a leading private life insurer. After scrutinising my documents, I was told that I was eligible for the coverage. I submitted all documents, but was told that I would have to do a treadmill test at one of their designated centres,” he explains. Since he was not comfortable with doing this test at the company’s designated centre due to concerns over safety, the insurer asked him to scale down his requirement to Rs 1 crore. “I did not want to risk my life for a life insurance policy, so I agreed to settle for a lower cover. But then, endless wait started again. Finally, in August, I was told that they could not issue the policy as their underwriting team had raised an issue. They wanted me to give a declaration saying that I was not treating COVID patients then and worse, would not do so in future,” says Aran.
The life insurer finally relented after Aran registered his strong objection with the insurer’s senior management, pointing out that the requirement that a doctor should not treat patients with certain ailments was unethical. “I informed them that while I was not treating COVID patients at present, I might treat someone with fracture in future who later turns out to be positive. Then, the insurer might claim that I had not lived up the declaration, putting my family in trouble. I was fine with paying a higher premium if they felt that the risk was higher, but seeking such a declaration seemed absolutely derogatory,” he explains. His term policy of Rs 1 crore was issued after the senior official’s intervention and his declaration stating he was not treating COVID-19 patients at the time of policy issuance.
No discrimination against doctors, say insurers
Life insurers, however, deny that they are reluctant to cover lives of doctors and healthcare workers. “Some individual insurers might invoke stringent underwriting norms if a high-value term cover of, say, Rs 5 crore is sought, but they cannot insist that people would make declarations that they would not do what their vocation demands,” says Vighnesh Shahane, MD and CEO, Ageas Federal Life Insurance.
However, as part of tougher underwriting norms due to higher risks involved, life insurers might deny coverage to healthcare workers, said another life insurance CEO, who spoke on the condition of anonymity.
Insurers say that they have introduced an additional COVID-19 questionnaire and waiting period for those who tested positive. “But there is no change in the policy for doctors who are treating COVID-19 patients. It is possible that some individual insurance companies’ underwriting teams have adopted this approach, but we do not seek such declarations from doctors,” says Anilkumar Singh, Chief Actuarial Officer, Aditya Birla Sun Life Insurance.
Health premiums see a spike
Last year, health insurance companies had drawn flak for refusing to cover healthcare workers at the beginning of the pandemic. They relented after the Insurance Regulatory and Development Authority of India (IRDAI) the whip against such actions. This year, too, the Association of Medical Consultants is faced with an inflated group health insurance premium bill, despite claims being lower than premiums paid in 2020-21. “Our group health insurer has raised our top-up cover’s renewal premium from Rs 4,500 per person to Rs 5,000 per person this year. This, despite the fact that we paid premiums to the tune of Rs 3.5 crore, but claim pay-outs did not exceed Rs 70 lakh. We are not negotiating with them to reduce the premiums. The risk is also now lower due to vaccination of doctors and other healthcare workers,” points out Dr Sudhir Naik, Chairman, Medico-legal cell, Association of Medical Consultants.
The recourse for youIf you feel that the life insurer has delayed processing your proposal or has acted unfairly while rejecting your application, you can escalate the matter to the company’s grievance redressal officers. If you are not satisfied with their response or the company simply does not respond in 30 days, you can approach the insurance ombudsman offices.