Group Mediclaim Renewal with 140% Claims Ratio

The starting point is that group mediclaim is experience-rated. A 140% claims ratio, with two large cardiac claims and a cluster of diabetes-related admissions, is credible evidence of deterioration in a 400-life group. The existing premium of ₹48 lakh is inadequate if the trend continues. A 25% increase to ₹62 lakh still leaves the insurer with a loss if claims repeat, so the loading is not obviously excessive. But the underwriter should not rely on the sublimit alone. A ₹2 lakh cardiac sublimit may be a blunt instrument: it transfers a large part of a genuine hospital cost to employees and can damage the group relationship. Alternatives include a higher deductible, a co-pay on non-network treatment, a stop-loss or aggregate deductible, or a disease-management programme for diabetes. The underwriter should obtain the large-claim details, verify whether the two cardiac cases were one-off, and model the effect of the three new older joiners. Declining is hard to justify if the employer will accept modified terms; the better decision is a conditional renewal with clear data requirements.

New joiners should be underwritten under the group's eligibility rules, not treated as individual retail risks. The 30-day waiting period applies to new joiners, so the insurer should confirm the effective date and whether the cancer condition was known before joining. If the employee is already under treatment at the time of addition, the insurer may impose a specific exclusion, a waiting period or a loading, provided this is disclosed and applied consistently. The insurer cannot simply reject the whole group because of one member. The employer must provide complete health declarations for the three new employees. If the cancer claim arises within the waiting period, the policy wording will determine whether it is payable. The underwriter should document the decision and communicate it to the employer before the renewal date, because retroactive exclusions are a complaint risk. If the group rules prohibit individual exclusions, the insurer may need to price the risk into the group rate or use a separate carve-out with the employer's consent.

The insurer should explain the renewal in business terms: last year's premium, claims, the 140% ratio, the large-claim drivers, and the effect of the three new joiners. It should not simply announce a 25% loading. A clear renewal letter should show the base rate, the experience loading, the cardiac sublimit, and the options available. Fallback terms could include a higher aggregate deductible, a 10% co-pay for non-network hospitals, a chronic-disease management programme, or a two-year rate-stabilisation agreement with a claims review. If the employer threatens to move, the underwriter should test whether the competitor is quoting on incomplete disclosure; a lower quote often excludes the pending cancer case or assumes a healthier group. The insurer should avoid buying the renewal with an unsustainable rate. A transparent, data-led negotiation is more likely to retain the account than an unexplained discount, and it protects both parties if claims continue.