Apollo Munich Health Insurance looks to Raise Tier II Capital

Standalone health insurance company Apollo Munich Health Insurance is looking to raise funds through the Tier II capital route. Antony Jacob, Chief Executive Officer, Apollo Munich Health Insurance said that they will raise capital that may include non-convertible debentures (NCDs) based on the growth plans.“We will be looking for funds from time-to- time based on capital
requirements. The Insurance Act now allows insurers to use Tier II capital. But, no fresh equity infusion is expected,” said Jacob. Apollo Munich Health Insurance is a joint venture between the Apollo Hospitals Group and reinsurer Munich Re. The health insurer had collected premiums of Rs 1,300 crore in FY17 and Jacob said that they are targeting to touch Rs 1,700 crore in this fiscal.

“We believe that we will grow by 25-30% in the next five years,” said Jacob. Apollo Munich completed 10 years of operations in August 2017. Compared to when they started the business, Jacob said that the products under health insurance are no longer ‘one size fits all’.“The way health insurance is designed and administered has changed. Things like disease-specific
products are slowly catching on and we will continue to reinvent,” he said. The insurer is seeing more than 50% of the policies through the tablet mode. Wellness is another area, where Jacob said that they are offering solutions.“Whilst we are promising to take care of healthcare finances if you fall sick, but we also help you manage your health. Individuals will get 8% discount during renewals if they have averaged 10,000 steps a day through our app-based offering,” he explained.

In terms of business mix, retail constitutes 75-80% of the business while the rest is corporate/group accounts. Jacob said that unsustainable pricing is still a cause of concern for them.On the government sponsored health insurance scheme (Rashtriya Swasthya  Bima Yojana), Apollo Munich is not present currently, though it had been a part of it earlier. Jacob said that this is because not only is the government trying to bring in a new scheme and the existing one is limited to a few states but also because pricing also went to a level below cost and did not make financial sense for them.