3. Cost-cutting by Insurers

The insurer is also doing business and making money but if medical test reduces the risk then why they are making the cut by performing a test. Akshay Mehrotra, Chief Marketing Officer of Policybazaar.com says, “A medical examination can cost up to 3,000-5,000. If they absorb this, their cost of acquiring a customer goes up”.

On the flip side insurers admit that they save money by not doing a medical test but deny the actual purpose behind it. Subrahmanyam B, Vice President and Head, Bharti AXA General Insurance, “We do it from the customer’s point of view, so that they do not have to take the trouble of going to the diagnostic centre”.

The reason why these policies vastly spread the market is that they have a very fast and process of activation. The test like full medical report, HIV test, and Blood serum test can take a week to yield results. The insured person has to show tax exemptions proof under Section 80C. All these process takes a quiet of time. Aneesh Khanna, Senior Vice President and Head of marketing and product management od IDBI Federal Life Insurance says, “The basic concern is not the insurance cover or the policy features but the speed with which it can be issued to the buyer so that he can claim tax deduction before the 31 March deadline.