The New(!) Insurance Scheme Offered By Members of IBA

I thank all the dear friends who took pains and made sure to spread the message about the captioned scheme using the social media.  I have not heard in the matter from my erstwhile employer bank.  They have buried it deep inside their website in such a way that no one who doesn't have the complete URL can ever discover it.  This certainly cannot be taken as notice enough.  I am away from India and so don't know if any communication has been delivered the expensive old fashioned way.  What I can confirm is that there is no communication on my e-mail id registered with the bank.  One could argue that I remain part of the big family and since when has there been a need for formal communications in a family!  After all, didn't the message reach me?

This elderly grouse apart, I recall that there used to be a similar scheme in my bank earlier with an insurance company at the back end.  The scheme turned out to be loss making for the insurance company which then disassociated itself.  The reason was simple.  This was not seen as an insurance at all but an additional allowance with the limit being decided by your own ingenuity.  I have already started seeing postings on social media assuring retirees that it will not be difficult to recover the premium!  You will recall that retirees will have to pay their own premium while that for working staff will be borne by the banks.  With the pathetic pension that is doled out to bank pensioners it wouldn't have been excessively indulgent to agree to extend payment of premium to pensioners too.

While I am sure that suitable mechanism will be put in place to prevent the abuse of medical insurance as an undefined allowance, it cannot be gainsaid that pathetic levels of pay and pensions in public sector banks do make it tempting to do so.

I have also seen a representation asking that the cover made available to retirees should extend to their parents and dependents too!  I wonder if any insurance company will ever agree to provide health insurance to parents of a 60 year old person!  And if a person still has dependents after retirement, it only shows poor family planning for which an employer can hardly be held accountable.  (Though, there can be children with severe disabilities and cover may be demanded for them.)  It would have been more sensible to ask for payment of premium by the banks for retirees too.

Then again, the scheme doesn't have any upper age limit for coverage.  This means that it will cover employees and spouses till their demise.  As things stand, these days it has become almost a ritual to put a dying person in ICU on life support systems for a week or two.  This is probably medical profession's way of imposing an inheritance tax to finance its expensive operations.  But if an insurer were to foot the bill for such ritual life support, it will amount to certain outgo on majority of insureds of an amount that may equal or surpass the premium paid by them over a decade or two.  This doesn't make actuarial sense.  And whatever doesn't make sense financially is suspect in a banker's eyes.

So I am evaluating whether it is okay to remain with Baroda Health which covers me up to 80 years and then be content with the over-the-lifetime and not annual cover of two lakhs available from the bank.

Your inputs are welcome.