Mumbai: The ongoing focus on health insurance business is expected to provide the much needed boost to the third party administrator (TPA) business. TPAs provide the much needed linkage services to the customers and insurance Companies by managing the claims.
However they are not allowed to market health insurance products.
The business of health insurance which is offered by both life and general insurers are growing at 50% and is being encouraged by the Insurance Regulatory & Development Authority.
By 2012, the Indian TPA industry is expected to grow exponentially to Rs 15,000 crore in size in terms of value of premiums managed. With around 30 players, the current size of the TPA is estimated at Rs 4,400 crore and the business growing at 40%. The top five players have a market share of 60%.
Among the top ranking TPA players are TTK manages around premiums worth Rs 560 crore followed by MediAssist (premiums worth Rs 450 crore approx),and Paramount (with premiums worth Rs 400 crore approx), Raksha (premiums worth Rs 430 crore approx), Family Health Plan (premiums worth Rs 250 crore approx), MD India (premiums worth Rs 350 crore approx).
The life insurance behemoth Life Insurance Corporation(LIC) has now entered the health insurance market and has mobilised premium income of Rs 100 crores in last two months of 2007-08.
Observers say some Third Party Administrators (TPAs) in the Indian health insurance sector are spinning-off separate insurance brokerage firms or looking at strategic alliances with insurance brokers with a focus to improve overall business margins
Also some insurance brokers are looking at diversifying into TPA services or being strategically aligned to TPA service providers. Also some players in the TPA industry do not find the volumes and the fees economically lucrative proposition.
Source: The Financial Express
Friday, June 27, 2008
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