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How to exercise claim control measures in Group Health Insurance

Certain restrictions can be built into the policy to avail the optimize the premium to coverage benefit of the policy.

The room rent restriction is probably the most misunderstood clause in the group health insurance policy. If the room rent is restricted to Rs.3000 per day in the policy and the total bill is let’s say Rs.1 lac after three days of admission with room rent of Rs.5000/- then normally one will assume the claim payable would be Rs.94000 after deduction of Rs.6000 ( 2000*3 days).

But the claim payable is proportionate between the actual room rent of ₹5000 and room rent eligibility of ₹3000.

In this case it is 60% ie. ₹60000.

Hence if not communicated properly the employee will be shocked to see this kind of reduction and will have a negative opinion on the overall benefit program of the company.

It is common for insurers to link the room rent eligibility to the sum insured of the employee. As an example, "Room rentals per day are limited to 1% of the sum assured".

The room rate per day in Covid has increased many folds, which has adversely affected any policies that include this clause.

The best practice would be to customize the room rent clause to consider the “Single private AC room”

You can further personalize your incentives by offering a bonus of ₹1000 per day if the employee opts for a shared room instead of a single private room.

Choosing a single sharing room over a private room reduces the average claim amount by 30% without affecting the quality of treatment.