Rather this increase in premium of mediclaim works in favour of companies. In life insurance, premium remains same for 20-30 years, while mediclaim premium increases due to 3 factors
- due to client entering the next age band
- companies increasing the premium arbitrarily
- Govt increasing GST
Due to frequent increase in premium, the commission also increase and thus it motivates banks to sell mediclaim more. Also mediclaim can be easily portable every year and currently IRDA has allowed banks to sell mediclaim of 9 different companies, thus if client is not happy with claims of one company, bank ppl have the option of 8 other companies to port his policies, this will increase the stickiness of clients.
Also due to covid pandemic, awareness of mediclaim has been very high among public and they have realised that even though mediclaim is an expense, still its now under essential category of purchases.
Also there are seperate sections of Income tax rebate of 80D and 80 D(D) of Income Tax Act which also motivates ppl to purchase mediclaim, while in case of life Insurance there is just 80C of 1.5 lakhs which is anyways exhausted by PF, PPF and housing loan principle , and hence no more an attractive factor to purchase life insurance.
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