Four Companies Appoint KPMG To Study Possibility Of Venture
THE four public sector insurers — New India Assurance, Oriental Insurance, United India Insurance and National Insurance — have jointly appointed KPMG to weigh the pros and cons of jointly floating a Third Party Administrator (TPA). The idea was mooted to achieve better client servicing and building a sustainable and a competitive position in the health insurance segment. Currently, they have different TPAs.
Confirming the development, Oriental Insurance chairman M Ramadoss said: "KPMG has recently submitted its report. This will now be deliberated by the four insurers. They studied the positives and pitfalls of setting up a common TPA. The TPAs process claims on behalf of insurers and interact with hospitals, customers and the insurers."
The consultant took up the project in two parts. Phase I, spanning four months, included defining the business model of the new entity — the consultant laid out all conceptual issues, options and solutions. During this phase, the consultant engaged minutely on every issue pertaining to a common TPA with the PSUs.
In the second phase, which is yet to be taken up, KPMG will create and start the new entity — on approval of recommendations from Phase I. Phase II is envisaged to last 12-15 months. In this phase, the consultant will work with the PSUs to implement all accepted recommendations including detailing of processes, scouting for partner, finding key personnel etc. The ambition will be to start the new company.
"It is felt that a subsidiary or a model based on public private partnership (PPP) or a joint venture could help them achieve effective and better control on data, pricing, incurred claim ratio, and to provide the best services to health insurance policyholders," said a senior official from the General Insurance Council. The council is a representative body of insurers.
The initiative is being spearheaded by the General Insurers' (Public Sector) Association of India (GIPSA) — a consultative platform for its member companies to deliberate on the issues of common interest. Members of GIPSA are the four public sector insurers.
UNITED INSURERS
The idea of a common TPA was mooted to achieve better client servicing and building a sustainable and a competitive position
It is felt that a subsidiary, or PPP or a JV could help achieve better control on data, pricing, incurred claim ratio, and to provide the best services
