Social Security is the need of the hour for Developing Countries

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Social Security is the need of the hour for
Developing Countries

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Social Security

• Social security systems ensure the minimum level
  of living to the needy by public assistance, and
  they also promote public health and social
  welfare.

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Social Security systems

• They play three roles
• 1) Deal with factors that cause needy
  circumstances
• 2) Minimum level of living
• 3) Promote public health and social welfare.

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Social Security in foreign countries

• United States Income Security. Funded by tax
  revenues. The law, however, provides for
  unemployment insurance, health services, human
  services with people with disabilities, medical
  services for the elderly and medical assistance
  in addition to pension insurance.

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Social security in foreign countries

• France Sickness insurance and old age
  insurance.
• United Kingdom Income security such as pension
  and child allowance.

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Social Security in India

• India had an effective, economic and emotional
  security in joint families, crafts communities
  and guilds, customs rites of individuals, and
  panchayats. However, now the joint family system
  is breaking to nuclear families thus requiring a
  new framework for social security.

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• India being a Social, Democratic Republic it is
  the duty of the state to provide for social
  security schemes. A Socialist State is one that
  accepts the responsibility for providing and
  ensuring Social security to all its citizens
  without discrimination.

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Social Security in India (contd..)

• Social Security in India would require
• a) Minimum employment scheme
• b) Health insurance
• c) Maternity insurance
• d) Pension
• e) Childrens education
• f) Life insurance
• g) General insurance like cattle insurance.

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• The working population in India can be divided
  into
• Organized sector comprising of Government Sector,
  Public Sector and Private Organized sector
• Unorganized Sector

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• The Organized Sector has benefits like Gratuity,
  PF and pension. Hence does not require subsidy
  from the Government.
• The BPL in the Unorganized Sector would require
  Subsidy from the government.
• Total Workforce (1999-2000) 393.21 million
• - Organized Sector 38.93 million
• - Balance under Unorganized Sector.
• The total Outlay required for Providing Social
  Security to the Unorganized Sector would be
  beyond the budgetary provisions of the Government
  also.

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• Hence it is suggested that Social Security be
  divided into 3 levels
• A basic level where the State bears Primary
  responsibility for providing minimum level of
  Social Security
• Beneficiary makes a contribution to the cost
• Schemes that confer additional benefit beyond the
  basic level

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• A family which is living Below Poverty Line gets
  most affected if the breadwinner expires or if
  somebody in the family has to be hospitalized for
  some major illness.

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• LIC realizes its Social Responsibility. It
  created a Social Security Fund in the year
  1988-89 for subsidizing the premium for insurance
  cover to weaker sections of the Society. As on
  31.3.2006 the size of the fund was 808.25 crores.

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• Janashree Bima Yojana was launched on 10.8.2000
  to provide life insurance protection to the rural
  and urban poor persons below poverty line and
  marginally above poverty line at low cost.
• It has an add on benefit in the form of Shiksha
  Sahayog Yojana where Scholarships are given to
  the children of the members of Janashree Bima
  Yojana

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Eligibility

• Member should normally be the head of the family
• Persons below or marginally above poverty line
• between age 18 and 59
• Minimum group size 25
• 44 occupations have been identified so far.

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Revised Benefits From 15.08.2006

• Natural death Rs.30,000
• Accident benefit
• On death Rs. 75000 /- to the nominee
• Total permanent disability Rs.75000/- to the
  beneficiary
• Partial permanent disability Rs.37500/- to the
  beneficiary.

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Premium

• Rs. 200/- per annum out of which
• Rs.100/- by member/ nodal
  agency
• Rs.100/- from social security
  fund maintained by LIC Of India

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Nodal Agency

• Shall Mean
• 1. Panchayats
• 2. NGOs
• 3.Self Help Groups
• 4. Any Other Institutionalised
• Arrangements To Collect Premium
• It Will Act For And On Behalf Of The Insured
  Members
• To obtain application cum nomination form
• Incorporate the details in register of members
  and copy to be given to LIC of India

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Work of nodal agency

• 50 of the premium proposal papers list of
  members.
• Verification of age.

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Reimbursement of expenses to NGOs for
introducing JBY

• FOR N.B.
• Minimum Members Should Be 250
• For The First 2500 Lives Rs. 4 Per Member
• Balance Rs. 2 Per Member
• Maximum Rs. 50,000/-
• FOR RENEWAL
• Group Size above 250
• Rs. 2/- Per Member
• Maximum of Rs.10,000

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Claims

• Documents to be enclosed for claim
• Claim-cum-discharge form, attested copy of the
  death certificate
• For accidental claims
• 1) Post Mortem Report
• 2) Copy of FIR
• 3) Police Inquest Report
• LIC settles the claims by sending account payee
  cheque favouring the Banker Of The Beneficiary
  /Nominee

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Shiksha Sahayog Yojana
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Eligibility

• Students studying in 9th to 12th standards
  (Including ITI Courses).
• Parents Covered Under Janashree Bima Yojana.
• If student fails and is detained in the same
  standard, he will not be eligible for scholarship
  for the next year in the same standard.

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Benefits

• Scholarship of Rs. 300/- per quarter per child
  will be paid for a maximum period of four years.
• For student to become eligible for scholarship
  the parent should have been covered under JBY.
• Benefits restricted to two children per family.

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Identification Of Beneficiaries

• Nodal Agency should identify the students.
• The Nodal Agency should guide the members to fill
  up the application forms for this purpose.
• The list of beneficiary students along with the
  details should then be forwarded to the concerned
  PGS unit.

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Administration

• Scheme will be administered by LIC
• Scholarship will be disbursed to the beneficiary
  through the Nodal Agency.
• Nodal Agency has to furnish LIC with the
  necessary data of the eligible students.
• Nodal Agencies are required to maintain records
  and submit certificates / details of utilization
  of scholarships quarterly to LIC.

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Our Achievement

• There are 4.62 crore families living below
  poverty line in Inida.
• We have covered more than 1.5 crores lives under
  social security schemes.
• However, it is a long road ahead yet to be
  travelled.

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LICs MICROINSURANCE PRODUCT

• JEEVAN
• MADHUR

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JEEVAN MADHUR

• SIMPLE SAVINGS RELATED LIFE INSURANCE PLAN
• PREMIUM MODE ----WEEKLY / FORTNIGHTLY / MONTHLY
  /QUARTERLY / HALF- YEARLY / YEARLY
• SUM ASSURED BETWEEN Rs.5,000/- AND Rs.30,000/-

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BENEFITS

• MATURITY BENEFIT Payment of the Maturity Sum
  Assured along with vested bonuses, if any.
• DEATH BENEFIT Payment of an amount equal to
  total premiums payable during the entire term of
  the policy along with vested bonus, if any.
• ACCIDENTAL BENEFIT Equal to Death Benefit Sum
  Assured.
• AUTO COVER FACILITY AVAILABLE.

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Health Care in India
Source NIA Seminar Insurance news

• The total value of the health sector US 34
  Billion, 6 of GDP, one of the highest in Asia
• Of this 15 publicly financed,
• 4 social insurance,
• 1 private insurance
• remaining 80 ---out of pocket as user-fees (75
  of which goes to the private sector)
• 2/3rd users ----out-of-pocket
• 90 ---- poorest sections

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• Health Insurance in India
• 11 non-life Insurance companies including 4 PSUs
  regulated by Govt. ( IRDA)
• 25 licensed TPAs
• Total premium recorded as on March 2005 Rs.1300
  Cr. ( 260 million)
• Indian Health Insurance Industry grew at the rate
  of 27 ( last fiscal).
• Current population covered by some form of health
  insurance is 12 out of which mediclaim is 1.4 .
• How does the Health Insurance Industry looks
  today

Traditional Insurance (Mediclaim) 1
ESIS CGHS 3
Railways 1
Social /Mandatory Insurance 4
NGO/CBHI (Self funded) 3
Source NIA Seminar Insurance news
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• Experience Hodgepodge
• Though the health-care insurance industry was
  worth Rs.5,000crore in FY00-01, a growth of more
  than 200 over these years.
• the lapse ratio has not improved around 25-30 of
  mediclaim polices lapse in a year.
• the total number of non-life insurance rejected
  claim complaints filed, mediclaim accounts for
  about 65-70
• In case of rejected claims, companies need
  interface with the customer directly instead of
  the customer having to deal with third party
  administrator

Source NIA Seminar Insurance news
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Cont

• The industry estimates no specific reasons for
  the non-renewals,
• Difficulties in making health insurance more
  accessible to customers
• the grievances due to large numbers of rejected
  claims
• lack of services cause customers to default on
  payments or
• switch to other companies
• Claims in urban areas is 40 higher than semi
  urban areas
• As the government provides highly subsidized
  medical facilities, a majority of the people are
  not very keen on investing in health care.

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• Pros Cons of TPAs
• Purpose
• Electronic maintenance of the enrollment database
• Arrangement for the Network Hospital for
  extension of cash less treatment.
• Issuance of the card
• Issuance of Authorization for all the admission
  occurring at the Network Hospital.
• Claim Processing and Administration services till
  the settlement.
• Call Center services through National Toll Free
  No
• Generation of periodic MIS on Premiums, Claims
  and Utilization.

Source NIA Seminar Insurance news
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Results

• Impersonal dealing with the patients
• Unnecessary interference felt by doctors on their
  working ways
• Incase of claim rejection TPAs taken to as the
  bad man
• Nexus between TPAs and local hospitals
• Rationalized medical fee structure remained a
  dream
• Standard medical practices remained a dream
• As the cost needed by TPAs for rendering the
  promised services in the current health
  infrastructure would be too high to be afforded
  under the health plans in the market

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• The market the people
• Setting up of Health Insurance Regulatory
  Authority
• Standalone Health Insurance companies should be
  promoted
• Area-wise Standard medical and hospital charges
• standard medical practices should be promoted
• the combined effort of state governments and the
  companies under the guidance of the regulator and
  the central government to be harmonized.
• The Provider
• Network of Quality care providers in tune with
  health insurance companies interest
• Accommodate promote alternative medicines and
  such practices so that qualified doctors take to
  it

• (Based on www.ahip.org, www.kaiserpermanente.com)

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Road Ahead

• Principle Quality, Access and Affordability
• QUALITY - for health care, and Insurance
  services.
• ACCESS for all Indians through public and
  private coverage
• AFFORDABILITY through access and quality

Source AHIP Board of directors report
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• The market the people
• Setting up of Health Insurance Regulatory
  Authority
• Standalone Health Insurance companies should be
  promoted
• Area-wise Standard medical and hospital charges
• standard medical practices should be promoted
• the combined effort of state governments and the
  companies under the guidance of the regulator and
  the central government to be harmonized.
• The Provider
• Network of Quality care providers in tune with
  health insurance companies interest
• Accommodate promote alternative medicines and
  such practices so that qualified doctors take to
  it

• (Based on www.ahip.org, www.kaiserpermanente.com)

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Conti..

• The Insurer
• Product Designing
• Data to be classified and made heterogenic
  through Actuarially recommended medical
  underwriting.
• Proper database is to be maintained.
• Wide range of products as per consumer needs
  should be provided.
• Different health products for different
  categories of diseases regions.
• Providers should be involved in product
  designing.
• Formulating proper outpatient strategies along
  with pharmacy policy
• Delimiting exclusions and pre-existing medical
  conditions

• (Based on www.ahip.org, www.kaiserpermanente.com)

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Conti.

• Marketing
• Incentive to Hospitals and agents for promoting
  health products.
• Creating awareness among people of target market
• Insuring through various organized sectors such
  as municipalities, state governments, private and
  public sector companies, gram panchayats, schools
  and colleges
• Claims
• Credit facility at point of service so as to
  reduce uncertainty concerning the time frame
  within which reimbursement will take place.
• Greater efficiency in the processing of claims
  through rationalized fee structure standard
  practices stipulated by the regulator and given
  way through different products.
• Proper claim administration set up. IT network
  for proper data administration and claim
  settlement.
• Vigilance
• Accountability and transparency of the health
  company practices providers
• Continuous Morbidity Investigation Bureau (CMIB)
  to function within the company in order to
  continuously monitor the changes required in the
  products.

• (Based on www.ahip.org, www.kaiserpermanente.com)

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