A rate war has erupted among the general insurers including the stand alone health insurers to bag the accounts of the different states for implementing the centre’s National Health Insurance Protection Scheme(NHPS) that promises to provide Rs 5 lak cover to 50 crore people for free.


The state of Nagaland has been the first one to go for bidding by which it would select an insurer to implement the NHPS in the state.


For Nagalnd, Apollo Munich Health Insurance has made the lowest bid for at Rs 444 per family, while Bajaj Allianz General Insurance was second lowest bidder at Rs 506.


The others who participated in the National Insurance bid Rs 1,944 per family and United India Rs 1,944. Reliance General Insurance and Religare Health Insurance Company Ltd had bid for Rs 1,020 and 1,060 per family respectively.


According to the industry observers, though Nagaland is a small state, the competitive rates offered by the insurers, particularly the private sector insurer,  may be indicating about the rates they would be offering for other states including larger states.


Secondly, the private sector general insurers are offering quite cheaper bids than their public sector counterparts and may bag the larger business in the scheme that would be spending  Rs10,000- in the first year.


“Unless public sector insurers are learning something from Nagaland bidding and improving their bidding by offering much cheaper premiums, they will have no chances in NHPS,’’ said an actuary of a public sector general insurance company.


However the public sector general companies have said they would do the business at the prices that   suit them.


Earlier the general insurnace industry had demanded a price of Rs 2500 per family to participate in the NHPS.


According to the industry sources, two more states Haryana and Uttarakhand will announce their bidding shortly.


Prime Minister Narendra Modi will officially unveil the scheme on Aug 15 and it is expected that most of the states may be completing their bidding process by that time.