IAI’s Health Insurance – Product Design and Pricing Training: Hits & Misses

Recently, Institute of Actuaries of India (IAI) conducted its first ever classroom training program on Health Insurance industry by the name of “Health Insurance – Product Design and Pricing Training”. The purpose of writing this is to share my experience on the same and what were the hits and misses of the training.

Hits:

Name: In my opinion, the name of the program was chosen very wisely, wisely enough to attract many of the working professionals from PAN India attending the session.

Faculty: First of all, I would really like to thank the faculty of the program to make this session very interesting and successful and specially for answering all our questions very patiently (as there were many!). IAI managed to bring some real experts from the industry for this particular session covering the Insurance and Reinsurance professionals from life, health and general insurance industries. You could only judge the experience of the faculty by knowing that there were appointed and chief actuaries present as the trainers.

Cost Effective: The program was priced at just Rs 4000/- exclusive of GST which in my opinion is very cost effective & productive for the attendees.

The Program: In my opinion, the program was structured wonderfully with the timely breaks! It was a three days highly interactive program which is yet to follow by two days of Webinar. Brief of the program is as follows:

  • Day 1:

Topics Covered –

(i) Overview of Health Insurance Industry

(ii)Understanding of fixed benefit products (Critical Illness & Hospital Cash) – Retail

Faculty –

Ms. Anuradha Shriram (Appointed Actuary – Aditya Birla Health Insurance)

Mr. Nirav Shah (DVP Actuarial – Aditya Birla Health Insurance)

Mr. Himanshu Manocha (Senior Manager – Aditya Birla Health Insurance)

Description –

First day of the program started with describing the ecosystem of the overall health insurance industry followed by describing the life cycle of the product from design to claim. After this, we were informed about the various types of products available in the market and the needs they serve. The session not just only covered the Health products but also described the role of an actuary (including appointed actuary) and the need of interacting with the other teams within the company.

“Being an Actuary is not just about the numbers, you must possess key business sense along with having good interpersonal skills to be able to communicate your work”

After the lunch break, the program covered the overview of various Reinsurance arrangements along with few examples on how to calculate the Reinsurer premium rates. At last, the training on first day concluded by describing about the fixed benefit products available in the Health Insurance Industry such as Critical Illness and Hospital cash and a Case Study & assignment was provided on pricing of fixed benefit health insurance product as homework.

  • Day 2:

Topics Covered –

(i) Understanding Indemnity Insurance products – Retail (Conventional)

Faculty –

Mr. Jaiwardhan Vij (AVP Actuarial – Bharti AXA General Insurance)

Mr. Anshul Mittal (Senior Manager Actuarial – Apollo Munich Health Insurance)

Mr. Sumit Ramani (Founder – Actuaria Consultants)

Description –

Second day covered both the aspects of theoretical as well as practical. It started with the description on the Indemnity based products in Health Insurance and covered how it is different and more comprehensive than fixed benefits products. Post this, practical aspects of the Health Insurance pricing was covered using the Excel Model. We were provided with the different data sets for the claim frequency and claim size and were taught on how to make relevancy checks on the data. After data cleaning part was done, it was shown to us how to price using the frequency-severity approach and find the ultimate Burning Cost. It was also shown that how other factors than frequency and severity affect the prices and what is the actual difference between the “Rating” (Price from the model) and “Pricing” (Price actually quoted in the market).

  • Day 3:

Topics Covered –

(i) Understanding the Product filing process – F&U only

(ii) Product Design Competition

Faculty –

Ms. Neha Podar (AVP Actuarial – HDFC Ergo)

Mr Abhijit Pal (Head of Pricing Life & Health – Munich Re India)

Mr. Sumit Ramani (Founder – Actuaria Consultants)

Description –

Third day was related more on us to deliver based on the Case Study that was provided to us on the first day. Session started with the brief description on the product filing procedures. This session covered the guidelines and regulations to follow while filing the Health Insurance product using File & Use procedure, role of the regulatory Authority (IRDAI) and how other teams in insurance space support you for the product. Before Lunch, President of IAI Mr. Sanjeeb Kumar himself addressed us and made us aware of the evolving fields for Actuarial profession and the role of Actuaries in them. Post Lunch, presentations on the Case Study was presented by the various teams in front of the Faculty whose agenda was to represent our learning from the training. At last, we were provided with a homework assignment to complete on pricing before the Webinar.

Misses:

Fresher Students: The major missing from the program were the fresher students who wants to learn about the industry and enter the profession. The program was designed in such a manner to help the fresher gain knowledge in the field and finally be able to land into a job/internship (IAI actually collected freshers’ CV and said they will forward it to appointed actuaries of various companies). 80%-85% of people who attended the session already had a job and just attended to enhance their skills and knowledge in the field.

“Learning should never end”

Timing: The training was planned alongside with the first ever seminar on Finance and Investment. Attendees who wanted to learn more on non-traditional areas of Actuarial couldn’t attend it due to date clash.

Reach: Training was held in Mumbai where majority of IAI events takes place. IAI could plan on to extend the reach atleast in Tier 1 cities either through live video sessions or planning such trainings in multiple cities as it is not feasible for everyone to travel to Mumbai.

Verdict:

There are 2 days of webinar still to follow but already I give this training and initiative a big Thumbs Up. I am in a big hope that IAI will now continue on the same path to provide such trainings to those who wants to learn or enhance their knowledge from the direct interaction with industry experts. Attending such programs also helps you in building your network.

Just few days back, IAI announced a program by name “Student Orientation Program (Life Insurance) and Employment Mela”, program seems interesting enough for those who are in search of their first job or want to have a change. Freshers – Go for it!

Let’s support IAI with their new initiatives and help them to grow the profession continually.

– By Akshun Geetesh

Mayank Goyal

Redmond Lover(Microsoft), London Dreamer(Actuary), California Thinker(Entrepreneur).

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