India’s New Insurance Product – The Pollution Policy


My wife told me to get a Health Insurance done. It’s not any more a fashion but a necessity she said. Especially since we live in Mumbai.

I agreed.

Health insurance is now a growing segment in India. The health insurance premium has registered a compounded annual growth rate (CAGR) of 32 per cent for the past eight financial years.

I asked my Professor Friend for an advice on which insurance company I should talk to.

Oh, easy, why don’t you join me for a breakfast meeting at the Grand Hyatt in Santa Cruz with S.K. Roy, Chairman of LIC, CEO of Max Life Rajesh Sud, G Srinivasan and CMD of New India Assurance, Sandeep Bakshi. CEO of ICICI Pru and Sanjay Bajaj of Bajaj Alianze are also joining. All these friends will give you perfect advice.

I got a bit worried that talking to these “insurance czars”  could mean simply too much of receiving advice and hence a risk. I was however not able to understand Professor’s role in this breakfast meeting. Whats his connection? I was wondering. But since the breakfast was set at the Grand Hyatt, I decided to follow Professor’s suggestion. I love the Kanchipuram Idlis and Pesarattu (Green Gram Dosa) out there.

It was a Sunday morning and all the insurance company honchos came in Tee shirts with their tag lines. S K Roy’s Tee shirt had the usual drab tag line – Yogakshemam Vahamyaham which no one understood. Tagline of Rajesh Sud’s Tee shirt was Aapke Sachhe Advisor that put me in some doubt. Born to lead was the tagline of G. Srinivasan that made no sense and Sanjay Bajaj carried the tagline Jiyo Befiqar. Sandeep Bakshi had a tagline Zimmedari ka humsafar and both these taglines sounded rather filmy.

Professor took a gulp of coffee from a large mug and opened the meeting.

“Gentleman, many of you asked me about the recent news about Delhi losing on the life expectancy by 6.4 years. – a news that was based on a publication from Indian Institute of Tropical Meteorology (IITM) jointly with the National Centre for Atmospheric Research (NCAR), Colorado, United States. This study titled ‘Premature mortality in India due to PM2.5 and ozone exposure’ was first published by the peer-reviewed journal Geophysical Research Letters (GRL) on May 2014, but was reported by some papers only last week”

“Interesting” said S K Roy, while picking up a banana. “So on one hand we are doing well by increasing the life expectancy through advances in medicines, but on the other hand we are losing the battle because of pollution”

G Srinivasan supported Roy. He was eating organic corn flex that was imported from Australia.

For those who may not be familiar with the term life expectancy – The World Health Organization defines life expectancy as “the average number of years a person is expected to live on the basis of the current mortality rates and prevalence distribution of health states in a population”. In India, average life expectancy which used to be around 42 in 1960, steadily climbed to around 48 in 1980, 58.5 in 1990 and around 62s in 2000. Statistics recently released by the Union ministry of health and family welfare show that life expectancy in India has gone up by five years, from 62.3 years for males and 63.9 years for females in 2001-2005 to 67.3 years and 69.6 years respectively in 2011-2015. From Global averages, we are still low.


Experts attribute this jump — higher than that in the previous decade — to better immunization and nutrition, coupled with prevention and treatment of infectious diseases. So if your child was born in the last couple of years, he or she is likely to live five years more than children born a decade ago.

Experts have however pointed out that increasing life expectancy beyond 70 years would depend on environmental factors. These factors would include air we breathe and quality of water we drink. Yes, we will live longer, but the big question is how healthy our lives would be.  It seems that environmental pollution will be the fourth highest risk factor for deaths. The death count due to pollution is projected to swell in the coming decades because the population in most countries is ageing, and older people are more susceptible to illnesses caused by pollution.

Professor continued. He was having egg white in poached style on a multi-grain bread.

“Latest international research studies have shown that over 5.5 million people die prematurely every year due to air pollution. Earlier research has shown that India’s air pollution is cutting three years off the lives of some of the country’s residents.  This research analyzed air pollution measurements across India and found that more than half the country’s population — 660 million people in total — live in regions that have air pollution levels higher than India’s national standards. If those high levels of air pollution were brought down, the study states, Indian residents would gain, on average, an additional 3.2 years of life expectancy”

“So Professor, we must reflect impact of pollution on our calculations of the health premiums” said Sanjay Bajaj. I liked his remark as I saw him picking up the Pesarattu (Green Gram Dosa).

I thought of butting in now and said

“But the IITM study has been already rejected by Hon Minister Prakash Javadekar. According to him the study was based on research done in Europe and America and has been extrapolated to “defame” India. This study used a regional atmospheric chemistry model and not actual sampling, cohorts and long term observations. I was told that he has asked the Central Pollution Control Board (CPCB) to formally challenge the report later this week. So we shouldn’t take this 6.4 years of decrease in life expectancy that seriously”

Oh Yes, Professor said “That’s the problem of research publications and the news hungry journalists”

“Poor Sachin Ghude, leader of this paper, has taken long leave and is supposed to be in disguise. If you search IITM’s website, you will not see any mention of this study nor the publication. Fortunately there are no apologies posted!”

The IITM scientist Sachin Ghude, had clearly said, “Although these results are in line with other global estimates, such as the World Health Organization (WHO) and the Global Burden of Diseases (GBD), there’s no physical way to tell who has actually been killed by air pollution.” Gudhe had added, “The methods used in this study rely on statistical algorithms to construct estimates about a population’s response to pollution exposure using previous concrete observations on pollution and public health”. The problem is that most of these observational studies have taken place in regions with comparatively low pollution levels, such as Europe or the US, and we don’t have any epidemiological studies in India that look at the long-term effects of air pollution on mortality,” Gudhe had cautioned. But the news did not communicate these caveats. Thats typical of news-makers. Isnt it?

Sandeep Bakshi did not like my intervention. While picking up a chicken sausage, he smirked and said “Well, there must be “some truth” in this work. You can always find faults in every ground breaking research carried out. There is nothing perfect. Science evolves”

Most said “Hmm…” as all were enjoying the breakfast and didn’t want to speak.

“Well” Professor said. “The Journalist who broke this news was not up to date and picked up a 2014 article. More recent work on this subject has been published by Sourangsu Chowdhury and Sagnik Dey of the Centre for Atmospheric Sciences, Indian Institute of Technology Delhi. This paper titled “Cause-specific premature death from ambient PM2.5 exposure in India: Estimate adjusted for baseline mortality” shows that 50% population living in 45% districts of India is exposed at PM2.5 exceeding Indian air quality standard of 40 μg m−3 . Kinnaur in Himachal Pradesh was identified as the cleanest district (annual PM2.5 is 3.7 ± 1 μg m−3), while Delhi as the dirtiest metropolitan area (annual PM2.5 is148 ± 51 μg m−3). According to this research if India manages to achieve the national air quality target of 40 μg m−3, 44,900 (5900–173,300) less annual premature death is expected. If Minister Javadekar is really sensitive about Delhi then he will have to refute this recent study as well. But then how many studies can he refute? The CPCB will have nothing else to do but keep issuing rejoinders”

The Clean Air Act of US added years to the lives of Americans by reducing particulate pollution.Particulate data from 1970 to 2012 of US EPA yielded striking results for American cities. In Los Angeles, particulate pollution declined by more than half since 1970. The average Angeleno lives about a year and eight months longer. Residents of New York and Chicago have gained about two years on average. With more than 42 million people currently living in these three metropolitan areas, the total gains in life expectancy has added up to something substantial.

Rajesh Sud was keeping quiet for all this while. He was having Punjabi Paratha with Curd that was rather filling. He wiped his face with an eco-labelled napkin and said slowly

“It is clear that we must factor in our health insurance scheme the pollution. Today, researchers are publishing articles on air quality but there will soon be series of articles on reduced life expectancy due to poor water quality – especially in rural India. The question is how to be adjust our premiums to the place people live. For example, a person in Delhi will pay 5000 Rs extra compared to Bhopal etc. as the life expectancy in Delhi is claimed to be low”

Professor lit his Cigar. I knew that this is now the time for new ideas.

“Well, I recommend you to come up with an entirely new insurance product. Call this as the Pollution Policy. Through promotion of this new instrument, you will raise awareness on pollution to common person. This policy will also make the Government think hard on the overall economics.

According to IITM study, it was found that the cost of the estimated premature mortalities was about $640 billion in 2011 —about 10 times higher than the country’s total expenditures on health that year. If you look at the health insurance premium for 2011 – it was just about USD 2.0 billion. May be the new Pollution Policy will click and it will generate USD 2.0 billion to start with which may grow to say USD 5.0 billion through aggressive marketing. Perhaps Government could take share of this premium and improve the hospital infrastructure by setting up respiratory treatment wards or more importantly invest in arresting air pollution i.e. prevention of pollution at source. You the Insurance companies will thus  provide protection to the pollution affected people while tapping the billion dollar market of Pollution Policy Premiums and in this process help the Government. NITI Aayog wants more such innovative insurance products to come up in the public health arena”

I thought I should add something interesting here as I was waiting for my strong filter coffee.

“Friends, China’s largest online travel agency is now offering tourists “smog insurance”, permitting travelers to claim financial compensation should their city break be blighted by bad air. has created the “haze-travel insurance package” in collaboration with the Chinese insurance firm Ping an and has been selling this new product.

The insurance is focused on six cities including Beijing, Shanghai and Xi’an, all of which are popular with tourists – and also suffer from poor air quality. Under the new insurance package, tourists who spend at least two days in the designated city while pollution levels are high will be able to file claims.

Evidently aimed at domestic rather than international tourists, the premium comes to 10RMB (£1) and travelers can claim 50RMB (£5) per day.”

All listened to me politely. “Travel insurance is another story” – said the Professor – “but you can draw ideas for the Pollution Policy”. He patted on my back.

When we were existing the Grand Hyatt, S K Roy walked with me “Dr Modak, I would like to change my tag line. Any suggestions?”

I said consider “Come to Us – We have the Solution to Pollution

“Thank you Dr Modak” said Mr. Roy “Let me discuss with my colleagues”

While getting in the car, I was just thinking “Is Pollution Policy the real Solution?

Cover image sourced from



  1. Sir,
    I work in Insurance field.
    This is a thought – provoking piece.
    Written in light entertaining style.
    Just wondering,
    how about solution to pollution itself?

  2. sir i want to work with you and want to learn lots of thing from you . can it be possible ?

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