Buying life insurance is likely to get more affordable, while health insurance could get dearer. Improved life expectancy among the insured population will keep the cost of life cover down, but the cost of health covers is expected to move up because of various court directives asking insurers to cut out exclusions.
Mr Sanket Kawatkar, head of life insurance at actuarial consulting firm Milliman, said that there is an improvement of around 10% in the new mortality table, which is prepared by the Institutes of Actuaries of India, according to a report in Times of India.
According to Mr Kawatkar, insurers may choose not to reflect the new tables because life insurance premiums are already the lowest in the region.
Global reinsurers are bullish on India as it is seen as the market with the highest latent demand. “The protection gap in India is estimated at $9trn, making it one of the biggest markets in terms of potential,” said Mr Kawatkar, consulting actuary with Milliman.
Health insurance is expected to see an increase in rates. According to Mr Lalit Baveja, senior health management consultant at Milliman, the scope of health insurance in India is set to increase due to court interventions for covering hitherto excluded illnesses like HIV, mental ailments and congenital defects.
“Insurance companies will have to rework all their existing products to address these exclusions and file them with the insurance regulator with revised pricing,” said Mr Baveja.