Student Dissertation

Agency : Health Insurance; Refund Process; Turnaround time

Background : New Business Operations: New Business operations take care of all the activities or manage relation with the customer before Policy issuance or at the time of policy issuance. The issues like hard copies not received, details of refund etc. are looked after by the NB team. Processing of Refund: Refund is generated when the case is rejected or if there is any excess amount paid by the customer. Once the case gets rejected by underwriters or due to high ageing, it is shown in the Rejection (RJ) bucket in the system. Before initiating the refund process, cheque clearance is checked. Refund is initiated only when the clearance is updated for the case. Once the clearance is uploaded, refund process is initiated and request is sent to the finance. After receiving the request for the refund, finance send the consolidated file to the bank and bank does the payment and then shares the UTR details with the finance. Refund is done on following case: 1. 1. In case of underwriter Rejection 2. 2. High Ageing 3. 3. Counter Offer Not accepted In case of rejection, according to the norms, while refunding the amount, pre policy medical checkup (PPMC) charges should be deducted, but the system does not allow the same. And entire amount is refunded to the customer without any reduction of PPMC charges.

Methodology : What is the turnaround time of the refund from the time of the initiation of the process till customer receives the same? Purpose of the study: To calculate turnaround time (TAT) of the refund amount generated by rejection or excess amount paid by the customer, from the time of initiation of refund process till customer receives the same and also to raise the change request of the system allowing the PPMC deduction from the refund amount Need for the study: The need for the study was to know about the turnaround time (TAT) of the refund amount generated by rejection or excess amount from the time of initiation of refund process till customer receives the same and also to raise the change request of the system for PPMC charges reduction from the refund amount. Objectives of the study: The main objectives of the study are: - ? To calculate turnaround time (TAT) of the refund amount generated by rejection or cancellation or excess amount from the time of initiation of refund process till customer receives the same. ? To suggest measure to reduce the TAT of the refund. ? To raise the Change Request of the system to deduct the PPMC charges which is currently not deducted, and customer is refunded the whole amount Study design: Cross Sectional Study and observational study This study design was appropriate as this is an observational study that analyses data collected from a population, or a representative subset, at a specific point in time- that is cross sectional data. The study was done on the entire data; as a result, the probability of accuracy of study will be more. Reasons for taking entire data: • ABHI has recently started operation in health insurance domain hence the size of available data is limited therefore the sample size is approximately equal to entire data available. Data collection: The main source of information for this study was based on the data collection. The data was collected from the various departments of Aditya Birla Health Insurance, websites of IRDA. Retrospective study was conducted and data from December to February was taken from Operations and Finance Department. The data collected from these months were then compared with the data obtained in the month of March, April and May, after taking measurements of improvement Data analysis: Turnaround time of the refund is calculated by • Firstly, Refund by operations is calculated by below formulae Refund by Ops = Refund date by Ops - date of proposal Rejection • Secondly refund by finance to the customer is calculated by Refund by Finance = UTR date – Refund date by Ops Total turnaround time of the Refund = Refund by Ops + Refund by Finance Tools for analysis will be: • Percentage Analysis • Graph

Findings : • The data indicates that the TAT of the maximum cases was beyond 10 days or in between 8 to 10 days which requires urgent attention as it breaches the compliance. • Such high TAT results in customer dissatisfaction, which further effect the company’s reputation. • It was observed that the refund by Operations was mainly due to the finance non-clearance. The ops team did not initiate the refund, as they do not get clearance from the finance for the payment. • It was also observed that lot of cases were pending due to the IT issue. As the company has newly started in insurance sector, the IT system is not developed efficiently, resulting in lot of IT problems. This further affects the refund and thus increases the TAT of the refund. • Lack of coordination between Finance and Operations team. • Routine monitoring of the refund process was lacking. It was not made as the routine work due to other priorities and lack of human resources. • PPMC charges were not deducted from the refund amount resulting in financial loss to the company. The customer is refunded 100% payment, which is ideally not correct. The PPMC charges should be deducted from the amount but due to system issue, it was not done.

Recommendations : The standalone health insurance arm under the brand Aditya Birla Health Insurance (ABHI). The new business segment is a joint venture between the Aditya Birla Group and MMI Holdings Ltd (MMI), a diversified financial services company in South Africa. It is a new startup in health insurance domain. For the company, customer satisfaction and trust is of prime most importance. The company takes all the customers on the individual basis and give priority to their rights. It performs all the possible actions required to develop trust among the customers. It aims to empower and motivate the people to live healthy life. For achieving customer satisfaction, refund plays a very vital role. Insurance sector, where fraud is very common, company takes all the measure to take necessary actions to avoid such frauds. Returning the money back to the customer in their account on time, impacts on customer satisfaction leading to maintain the relationship with the customer.


x