Analytical Study of Incurred Claims Ratio of Private Health Insurers

Abstract

Purpose: This paper aims to explore ten years of data on net premiums received and incurred claims of select health insurance companies and compare it with public sector total health insurance. 
 Design/methodology/approach: It is an exploratory paper comparing year-on-year premiums received and incurred claims of health during the period 2011-12 to 2020-21. ( Indian financial year start from April to March). Data has been shown in charts with trend lines without constants. Further, the Compounded Annual Growth Rate ( CAGR) has been calculated using log-linear regression. 
 Findings: The private sector is in business to earn profits, while the public sector is liberal in remitting the claims. Private-sector businesses earn more premiums than the public sector. However, the private sector’s incurred claims are comparatively much less than the public sector’s. The private sector is increasing business, but public sector growth is falling. The difference between year-on-year net premiums and incurred claims of the public sector is decreasing at 6.95%, but the same is increasing in the private sector at 19.63%. However, it cannot be generalised that the private sector is taking over the public sector business. The public is playing its social responsibility with accountability. However, the private sector aims to earn more earnings.