What are details of the recent investment on Religare Health Insurance?
Recently, private equity firm Kedaara Capital came on board as co- 2/3 promoter, investing about Rs 567 crore in Religare Health Insurance. This capital infusion will enable Religare Health Insurance to make further investments in technology to build a future-enabled organisation, committed to ensuring quality customer experience. With this The Religare Group’s stake in the flagship insurance venture was lowered by about 18% in June.
Currently, the RHI shareholding for quarter ending June’20 is REL (72%), Kedaara Capital (18%), Union Bank of India (~6%), other retail investors (~4%).
How has the company fared in the current fiscal? With the pandemic, many industries have witnessed a shift in consumer behaviour, what has been your learning and how will it affect your business planning?
The pandemic has led to a pronounced increase in awareness and understanding of the need for health insurance. We welcome this trend and as a responsible organization and corporate citizen, would urge people to certainly look at coverage for treatment of Covid-19, but not limit it to that.
The importance of a policy with comprehensive coverage cannot be undermined. India retail health insurance is abysmally low where penetration is only 3% and out-of-pocket healthcare spending stands at around 65%. Only resolution is a health insurance cover.
We expect robust business going forward and hence raised the capital ahead of its time. At the moment, our solvency after the infusion is at 270%, which gives us headroom for growth and we would also look towards investment in technology and human capital.
Advanced technological capabilities and changing customer behaviour are leading to a transformation in the insurance industry and we are piloting some AI projects, which will strengthen various processes in the organisation around claims and customer servicing. A large number of customers file insurance claims daily and to digitally enable both our customers and channel partners, we have provided them with a website, e-portal, and mobile applications. Owing to the digital platforms, 85% of our policies were issued digitally even before the COVID era which post COVID stands at about 95%.
We believe that in coming times, the consumers will look for insurance products with higher sum insured options to help protect them in events like Covid-19 and at the same time be reasonably protected from medical inflation. There could be more products which will offer benefits that come with an inflation indexed sum insured. i.e. sum insured will increase with time to take care of inflation.
What were your thoughts behind this transition, especially amidst the current pandemic in the country?
While the world is becoming more automated, convenient and impersonal, the personal, human touch – the essence of ‘care’ – continues to remain more important and relevant than ever before. Generations, genders and, even, locations have different definitions of care; ideas that are constantly evolving due to social trends, life’s pressures and technology. Despite the proliferation of the latter, the personal, human touch remains as important as ever across generations.
We’ve always believed that ‘Care’ lies at the centre of all that we do as a Health Insurance Specialist. From primarily ensuring our customers’ access to quality healthcare to broadening the spectrum of overall ‘Care’ beyond hospitalisation, to include preventive health check-ups, wellness, doctor consultations, diagnostics and home care. Also, the guiding principle of ‘Care’ has always been the fulcrum of all our customer-centric initiatives in the areas of product design, claims administration, technology development and customer service.
With the re-branding, what else will change for the end customer?
Absolutely nothing changes. We will continue to offer value-for-money products for every customer segment and ensure its servicing by technology-backed processes; all this under the purview of the founding management team. All aspects pertaining to the existing policy such as policy number, health card, cashless network, customer care details and claims and renewal processes remain unchanged.