Three pension funds plan health cover bundle: PFRDA

The Pension Fund Regulatory and Development Authority (PFRDA) on Friday said three pension funds are working on introducing retirement products bundled with health insurance covers to enhance financial security for subscribers.

PFRDA Chairman S Ramann said the proposed offerings are being conceptualised under a new initiative tentatively called the “Swasthya” pension scheme. The move aims to encourage individuals to build a dedicated corpus for medical expenses during retirement.

“Our aim is to try and get people to understand that they have to protect themselves. We want them to save money in a medical pension scheme. And it is dedicated for payment to medical purposes only,” Ramann told reporters.

According to him, the health cover component may be structured either through tie-ups with health insurance companies or through arrangements with healthcare service providers. The bundled product is expected to combine long-term retirement savings with financial protection against rising medical costs.

The regulator believes that such integrated offerings will address growing concerns around healthcare inflation and longevity risks, especially as India’s ageing population increases.

Industry experts say the proposed medical pension model could complement existing retirement schemes by ensuring that a portion of savings remains earmarked exclusively for healthcare needs, thereby reducing the financial burden on retirees and their families.

Further details on the structure and rollout timeline of the bundled pension-health products are awaited.