Till Nov. 03, 2013 the Oriental Happy Family Floater policy‘spremium calculation was unique & was very popular as in this the premium was calculated based on the age of the proposer. As a result the product was popular among large families comprising of self/spouse/parents/parents in law and even children below 21 years.
The revised calculation method announced by Oriental Insurance Co. Ltd. on Nov. 4, 2013 is:
· If one generation is covered the primary member would be the person of higher age
· If two generations are covered i.e. husband, wife & children, primary member would be the person of highest age.
· If three generations are covered by excluding the senior most generations, the highest age member will be the primary insured.
This has affected the premium amount a lot.
Let us see this with example
Let us take an example- Suppose a family of 4 members, husband (35yrs), wife (33 yrs), mother (60yrs), father (62 yrs) was insured for Rs. 6 Lakhs of sum insured. According to the old rate their premium would be 20490 Rs. But, according to the revised rate its premium will be 38200.
Oriental Happy Family Floater Comparison Rates | |||
Age | Old Rate for Rs. 6 Lakhs | New Rate for Rs. 6 Lakhs | |
Self | 35 | Rs. 7,140 | Rs. 1,430 |
Spouse | 33 | Rs. 1,430 | Rs. 1,430 |
Father | 62 | Rs. 7,800 | Rs. 31,220 |
Mother | 60 | Rs.4,120 | Rs. 4,120 |
Total Premium | Rs. 20,490 | Rs. 38,200 | |
Total Premium after S.tax (12.36%) | Rs. 23,023 | Rs. 42,922 | |
So, we observe that a total increase of 86% in premium hasbeen imposed on this family.
Due to this high increase in premium rate this product has lost its attraction. Is it good or is it bad for the company – only time will tell. We foresee many families will use the portability clause to switch over to other companies.
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