Chennai, April 5 (IANS) City based health insurer Star Health And Allied Insurance Company Ltd is hoping to break even this fiscal and also build its investment income in an handsome manner while expecting another Rs.10 crore from the Tatas towards equity, a top company official said.
The company also hopes to earn around Rs.50 crore this fiscal from its new product ‘Star Cardiac Care’ targeted at those people who have undergone a heart bypass or stent surgery between six months and three years from the date of insurance proposal.
Speaking to reporters here Friday, chairman and managing director V. Jagannathan said: “We hope to have an underwriting profit (simply premium minus claims paid) of Rs.80 crore this fiscal and break even. We received Rs.110 crore from Tata Capital around ten days back. We will get another Rs.10 crore from them.”
Company officials told IANS that the Tatas will hold around 14 percent in Star Health’s equity capital of Rs.326 crore.
Tata Capital Growth Fund (domestic) has taken 4.81 percent and group company Alpha TC Holdings PTE Ltd, Singapore holds 9.62 percent.
According to Jagannathan, with the capital infusion from Tatas, the health insurer may not need any major funds for this fiscal.
Officials told IANS that Star Health will also start building its investment income from the current fiscal onwards and expect to earn around Rs.50 crore. Last fiscal, the investment income was around Rs.20 crore.
He said the company closed last fiscal with a total premium income of around Rs.900 crore out of which Rs.800 crore is from the market and around Rs.100 crore from government schemes.
“Ten percent of our premium is accounted by corporate sector,” Jagannathan said.
Speaking the new product, he said the company has come out with a novel product of providing insurance protection for people who have undergone heart surgeries – bypass or stenting – to take care of repeat admission.
Executive director S. Prakash said: “A fair percentage of people who had undergone heart surgeries undergo repeat surgery for the same ailment. This certainly drains out the financial position of a normal family.”
The product has two plans offering sum insured of Rs.400,000 (Gold Plan) and Rs.300,000 (Silver Plan) and is available for persons in the age group 10-65 years. The policy covers pre-existing cardiac ailments from the 91st day of inception.
Officials told IANS the new policy is around 40 percent costlier than the company’s normal health insurance policy as it covers the pre-existing cardiac ailment. The normal health insurance policy covers pre-existing ailment only after four claim free years for that health condition.
To a specific query, Jagannathan said the company would not force normal health insurance policyholders to migrate to the new product once they undergo a bypass/stent surgery.
He said the company would also allow a ‘Star Cardiac Care’ policyholder to go for normal health insurance policy if no claim is preferred for the first four years.
However a company official told IANS that such a situation will be like back door entry and it has not been visualised till now.