Star Health launched a policy — Star Wedding Gift — designed with newly-weds in mind. The policy offers basic health cover for the couples on a floater basis. The policy also provides for child delivery expenses. The qualifying age-bracket for availing the benefits of the policy is 18 to 40 years.
Three years after the purchase of the policy, it will cover child-birth-related expenses, any congenital diseases of the child, and provide medical insurance for the parents and the children. Company officials said there were medical insurance products in the market that also covered child-birth expenses, but Star Wedding Gift is more specific to child-birth with general medi-insurance riding alongside.
Now, insurance is about covering uncertainty and chance occurrence, while the delivery of child in a wedlock is not that. How does an insurance company make money on a policy like this, where the claim is more or less certain?
Company sources explained that infertility rates in India are about 30 per cent—divided between men and women—therefore, the claims are roughly 70 per cent. Moreover, there is a waiting period of 3 years for the policy to become operational. Therefore, the policy is remunerative for the insurer. The customer would also find it useful because it has many beneficial features such as cover for post delivery complications and lump sum payments if the child is born with Down's Syndrome or Cerebral Palsy.
Star Health and Allied Insurance Company expects to close the current year with a topline of Rs 1,250 crore. Last year, it made a profit of Rs 5 crore. Company officials say that current year's profits will be substantially higher.