How Aditya Birla Health Insurance plans to achieve full year profitability by FY26

'We want to play the value game for our consumers, which is health and retail will grow faster for us than the group.'

Aditya Birla Health Insurance (ABHI)'s focus on retail segment, strong renewable book and innovative products will help in the health insurer's aim to achieve full year profitability by FY26.

Mayank Bathwal, CEO of the firm, discussed the premium growth and product launches that will support the growth along with the impact of regulatory developments in a virtual interview with Aathira Varier/Business Standard.

Aditya Birla Health Insurance is targeting a full-year profitability by FY26. How do you plan to achieve it?

Our plan is to achieve full year profit by FY25-26.

It is a function of few things like size of portfolio, efficiency of distribution, strong renewal book and move towards expense of management (EOM) guideline of the regulator among others.

Our Gross Written Premium (GWP) is already at Rs 3700 crore in FY24.

We are now moving very close to Rs 5000 crore, potentially by FY25.

On the back of these factors along with innovative products and superior customer experience we will continue to grow ahead of the Stand Alone Health Insurance (SAHI) companies which will lead to profitability by FY26.

When the group insurance segment continues to grow for the industry, what are the plans for product mix?

We have both a retail and group health segment. In the group segment, we mainly cater to the MSME segment.

Our focus is more on the retail health segment and it has been growing more than the group segment and we would like to continue the trend even in this financial year.

Also, renewability is strong in retail health.

The customer acquired, stays for a longtime.

Even if the trend is similar for the group segment, it is a lot more price sensitive.

So yes, the group will grow overall for the industry, but we don't want to play in the price game.

We want to play the value game for our consumers, which is health and retail will grow faster for us than the group.

In FY24, our retail health segment accounted for about 52 to 55 per cent of our product mix and the balance was group segment.

Going forward, we would like to increase the share of retail further to 60 per cent.

What do you think of the insurance brokers' suggestion to be allowed the permission to appoint 'Bima Vahaak'?

'Bima Vahaak' is a new experiment. Anything which increases the spread of distribution is good, as long as the whole process is managed efficiently.

Also, cost of sales should not increase.

'Bima Vistaar' has a regulated commission of 10 per cent and if the broker and 'Bima Vaahak' believe that this is collectively good for them, then it is fine.

What do you think is the impact of the new Master Circular on Health Insurance products including speedy settlement of claims?

Well, I think it is not a problem for us because I would say 97-98 per cent of our claims are settled within two hours.

We are also keenly waiting for the health claims exchange.

The day it will be launched by NHA, the process will become even better because all the information flow will become better.

Also, something we haven't fully announced is that we are working with insurtech players to digitize the data completely and use machine learning and AI to adjudicate our claims, which has actually reduced our time to process claims even further.

So, we have already invested in some of these technologies which will help us in meeting this requirement.

The health insurance industry will have to work towards making sure that the new set of requirements are met fully because some work has to be done there, including in case of products and creation of a (Claims Review Committee) CRC.

There is some work that needs to be done in the next maybe 2-4 months for the health insurance industry to fully gear up to deal with the regulatory environment.

Do you have any new product launches in your pipeline?

We had recently launched a new product, ActivOne (in December). It is doing extremely well for us.

We understand that it is one of the leading products on open platforms like PolicyBazaar and others.

I think we have done (business worth) close to Rs 200 crores in the December to March period.

In the first 100 days itself we had around Rs 100 crore.

I think the product is very successful because of its inclusiveness and comprehensiveness.

The product pays the customer for their good health.

The product has seven versions in it and we have not launched all the versions fully.

So we are very excited about that offering.

We don't see any launches immediately, because we have some work to do for the existing products under the regulatory changes.

Feature Presentation: Aslam Hunani/Rediff.com