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Exclusive | Covid vaccine reluctance: Adverse reactions covered under health insurance

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If you’re hesitant about taking a COVID-19 vaccine fearing an adverse reaction and huge hospital bills that will not be covered, you may want to reconsider that position. Your health insurance policy will certainly cover any hospitalisation due to a reaction to the vaccine.

General insurance industry sources told Moneycontrol that they will be covering any vaccine-related hospitalisation, in line with regular policy terms.

“Adverse reactions to new vaccines are expected. If a policyholder experiences any discomfort after taking the COVID-19 vaccine and needs to be hospitalised for treatment, it will be covered under health insurance. We have clarified this to the regulator,” said the claims head of a non-life insurer, speaking on condition of anonymity as IRDAI may issue a circular clarifying the matter.

The insurers have clarified this to regulator IRDAI recently through their industry body, General Insurance Council, which has all the general insurance companies as members.

However, as reported by Moneycontrol earlier, vaccination costs are excluded.

And, as with all health insurance products, a policyholder will have to hospitalised for a minimum of 24 hours for treatment to avail the claim.

Several healthcare workers had approached non-life insurers seeking clarification on policy coverage for vaccine reactions and allied hospitalisation.

1.58 million vaccinated, 1,238 adverse events recorded

So far, 1.58 million people have been vaccinated against COVID-19 in India. A total of 1,238 adverse events have been recorded so far. This is 0.08% of the total vaccinations according to the health ministry. In those reporting adverse reactions, 11 have been hospitalised.

There have been six deaths reported so far of healthcare workers who received the vaccine. The government has stated that these deaths are not linked to the vaccine.  India began its vaccination drive on January 16 and will inoculate frontline workers first.

Union health minister Harsh Vardhan, through a social media message, said that the public should not pay heed to rumours. “Stay informed, stay safe & when your time comes, get vaccinated,” he said. This was amidst reports of vaccine hesitancy among healthcare workers due to safety concerns related to Bharat Biotech’s Covaxin.

Moneycontrol has reported that Bharat Biotech's Phase-1 interim data, published by the company in the peer-reviewed British medical journal Lancet, found Covaxin was well tolerated and produced an immune response.

Some countries have agreed to indemnify the vaccine makers for claims as part of their purchase pacts. This means that the government will extend protection from potential lawsuits and related financial claims associated with vaccine-related adverse events if they are to participate in pandemic responses. India has not agreed to this so far.

This means that individuals taking the vaccine would have to fight lengthy legal battles to get financial claims for extreme adverse reactions. Those with health insurance would get claims passed as part of the regular settlement process in case they are hospitalised.

Insurers said that since there were several queries filed about adverse reaction-related hospitalisation being excluded, they have clarified this to the regulator.

“It is incorrect to say that we will not cover claims. Hospitalisation will not be excluded for all policyholders if their health policy covers this,” added the underwriting head at a state-run insurer.

The process to file a claim will be similar to the regular health insurance claims process. If a policyholder needs to be hospitalised in case of treatment for a vaccine-related adverse reaction, he/she has to inform the insurer.

Depending on the health insurance policy, an insured person can avail of either cashless cover or reimbursement for the hospitalisation. The final claim amount will be paid based on the policy size and sub-limits for room rent and doctor’s fees, among other charges.

However, as reported by Moneycontrol earlier, it is only hospitalisation claims that will be paid. Vaccination costs or treatment/medication for minor fever, body ache by local doctors after taking the vaccine will not be borne by the insurer since this does not involve hospitalisation.

FDI in India rose by 13% in 2020, as inflows declined in major economies due to pandemic: UN

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Foreign Direct Investment into India rose by 13 per cent in 2020, boosted by interest in the digital sector, and while fund flows "declined most strongly" in major economies such as the UK, the US and Russia due to the COVID-19 pandemic, India and China bucked the trend, the UN has said.

An investment trends monitor issued by the United Nations Conference on Trade and Development (UNCTAD) on Sunday said that global foreign direct investment (FDI) collapsed in 2020 by 42 percent to an estimated $859 billion from $1.5 trillion in 2019.

Such a low level was last seen in the 1990s and is more than 30 per cent below the investment trough that followed the 2008-2009 global financial crisis.

The decline in FDI inflows was concentrated in developed countries, where fund flows fell by 69 percent to an estimated $229 billion.

However, FDI in India rose by 13 percent, boosted by investments in the digital sector.

"China was the world’s largest FDI recipient, with flows to the Asian giant rising by 4 percent to $163 billion. India, another major emerging economy, also recorded positive growth (13 percent), boosted by investments in the digital sector,” the report said.

It added that "in relative terms, FDI flows declined most strongly in the UK, Italy, Russia, Germany, Brazil and the US due to the dramatic impact of COVID-19. India and China bucked the trend”.

FDI in South Asia rose by 10 per cent to $65 billion.

India’s 13 percent rise in FDI saw the total foreign investments for 2020 touching $57 billion.

The report noted that acquisitions in India’s digital economy was the largest contributor to this rise.

Cross-border merger and acquisition (M&A) sales grew 83 percent to $27 billion, the report said, citing social networking giant Facebook’s acquisition of 9.9 percent stake in Reliance Jio platforms, via a new entity, Jaadhu Holdings LLC.

Similarly deals in the energy sector propped up M&A values in India, it said.

Further, India and Turkey are attracting record numbers of deals in information consulting and digital sectors, including e-commerce platforms, data processing services and digital payments.

Despite projections for the global economy to recover in 2021, the UNCTAD expects FDI flows to remain weak due to uncertainty over the evolution of the COVID-19 pandemic.

The organisation has projected a 5 percent to 10 percent FDI slide in 2021 in last year’s World Investment Report.

The effects of the pandemic on investment will linger, said James Zhan, Director of UNCTAD, investment division.

"Investors are likely to remain cautious in committing capital to new overseas productive assets,” Zhan said.

According to the report, the decline in FDI in 2020 was concentrated in developed countries, where flows plummeted by 69 percent to an estimated $229 billion.

Flows to North America declined by 46 percent to $166 billion, with cross-border mergers and acquisitions dropping by 43 percent.

Announced greenfield investment projects also fell by 29 percent and project finance deals tumbled by 2 percent.

Greenfield investment is a kind of FDI, in which the parent company creates a subsidiary in the host country and builds its operations from the ground up.

The United States recorded a 49 percent drop in FDI, falling to an estimated $134 billion.

The decline took place in wholesale trade, financial services and manufacturing.

Cross-border M&A sales of US assets to foreign investors fell by 41 per cent, mostly in the primary sector.

On the other side of the Atlantic Ocean, investment in Europe dried up as well.

In the United Kingdom, FDI fell to zero, and declines were recorded in other major recipients.

Looking ahead, the FDI trend is expected to remain weak in 2021.

Data on an announcement basis, an indicator of forward trends, provides a mixed picture and point at continued downward pressure.

Sharply lower greenfield project announcements (-35 percent in 2020) suggest a turnaround in industrial sectors.

Similarly, the 2020 decline in cross-border M&As (-10 per cent) was cushioned by higher values in the last part of the year.

Looking at M&A announcements, strong deal activity in technology and pharmaceutical industries is expected to push M&A-driven FDI flows higher.

For developing countries, the trends in greenfield and project finance announcements are a major concern, the report said.

Although overall FDI flows in developing economies appear relatively resilient, greenfield announcements fell by 46 percent and international project finance by 7 percent.

These investment types are crucial for productive capacity and infrastructure development and thus for sustainable recovery prospects.

Risks related to the latest wave of the pandemic, the pace of the roll-out of vaccination programmes and economic support packages, fragile macroeconomic situations in major emerging markets, and uncertainty about the global policy environment for investment will all continue to affect FDI in 2021," the report said.

The coronavirus has killed over 2.1 million people, along with over 99 million confirmed cases, across the world so far.

Unemployed supertankers are about to get junked on Asia’s beaches

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Covid-19 is destroying the market for supertankers that deliver about a fifth of the world’s crude oil. The result is likely to be booming trade on the beaches of Bangladesh, India and Pakistan, where obsolete ships go to get blow-torched and sold for scrap.

Last week, the 1,200-foot vessels plying the industry’s busiest trade route -- from the Middle East to Asia -- effectively had to subsidize the delivery of cargoes because of how large the surplus of ships has grown.

While the vessel glut has really been in place since when Covid-19 caused oil demand to collapse early last year, it has until recently been masked by a huge chunk of the fleet storing crude that was previously surplus to requirements. Now, with Saudi Arabia and other major producers keeping millions of barrels off the market, and consumption stronger, those stored cargoes are being snapped up again -- leaving the tankers unemployed.

“It is hard to imagine a set of circumstances that is more against tanker owners than the ones at the moment,” said Brian Gallagher, head of investor relations at Euronav NV, owner of the world’s third-largest fleet of supertankers. “When you have scrap prices at these levels that’s very attractive, it changes the dynamic for owners of older tonnage.”

That will see more of the vessels sent to the world’s scrapyards, according to multiple conversations with tanker-company executives, many of whom didn’t want to discuss publicly how challenging the market has become. Clarkson Research Services Ltd., a unit of the world’s largest shipbroker, expects about 2% of the fleet to get demolished in 2021, up from almost none for the past two years. Its forecast was made before the slump into negative rates.

The scrapping may not be enough to save the market in the coming months. The amount of oil being shipped at sea remains far below normal levels as OPEC and its allies continue to withhold huge volumes of production and vessels that were used as storage during the oil market’s mammoth 2020 glut are now coming back onto the market and looking for business.

More importantly, scrapping is typically seen as a tactic that stops the rot. It doesn’t usually drive a surge in rates. On Wednesday, daily earnings for supertankers sailing on the benchmark Middle East to China route were -$1,190, according to figures from the Baltic Exchange in London.

The Baltic’s numbers assume fixed costs for a vessel, which can be mitigated. For example fuel costs can vary and ships are able to slow down to limit their consumption. Several of the tanker owners said they were doing this when sailing back to the Middle East for cargoes.

Scrap Value
Clarksons Platou AS, a sister company of Clarkson Research, estimates that ship speeds could now be coming down by almost 25%.

A period of relatively high shipping rates meant the number of supertankers getting demolished stayed low over the past few years. There were just two very large crude carriers, or VLCCs, scrapped last year and four in 2019. That compares with a total of 44 across 2017 and 2018, according to Clarkson Research Services Ltd. It counts a total fleet of 823 VLCCs.

The current earnings malaise will force ships that are more than 15 years old to consider heading for the break-up yards of Asia, the executives said. Every five years a vessel has to undergo a special survey that costs millions of dollars, money that’s hard to find when vessels are making a loss.

The scrap value of a VLCC currently stands at $18.95 million, according to the most recent Clarkson Research data. That’s the highest since March 2018 and could offer a further incentive to scrap.

Even so, most owners don’t expect a recovery in earnings until the second half of the year, when expectations are that oil demand will start to snap back toward pre-coronavirus levels. That should result in more volumes of crude sailing across the world’s oceans.

Until then owners have little to cheer. Some reported as many as 15 ships being offered to pick up some cargoes in the Middle East. At the moment, oil that’s stored in tanks on land is being slowly worked off by refiners. That, combined with an ever greater number of tankers returning to the market after being used to store oil at sea, means any turnaround in the tanker market won’t come overnight.

“It’s a challenging background,” said Euronav’s Gallagher. “It feels like it’s going to be challenging for a while.”

Budget 2021: Govt may tweak customs duties on host of goods

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They said that while import duties could be hiked on over 20 products such as cut and polished diamonds, rubber goods, leather garments, telecom equipment and carpet, the customs duties could be removed on select raw materials (like wood in rough, swan wood and hard board) used for furniture manufacturing and copper concentrate.

The government may tweak customs duties in the Budget next week on several goods, including furniture raw materials, copper scrap, certain chemicals, telecom equipment and rubber products, to promote domestic manufacturing and exports, sources said.

They said that while import duties could be hiked on over 20 products such as cut and polished diamonds, rubber goods, leather garments, telecom equipment and carpet, the customs duties could be removed on select raw materials (like wood in rough, swan wood and hard board) used for furniture manufacturing and copper concentrate.

"Expensive raw materials impact India''s price competitiveness in the international market. The country''s exports of furniture is very low (about one per cent), while countries like China and Vietnam are major players in the sector," they added.

The government may also consider reducing customs duties on coal tar pitch, and copper scrap, while raising the levies on certain finished goods like refrigerator, washing machine and clothes dryer, one of the sources said.

The government is already taking steps to boost domestic manufacturing such as introduction of production-linked incentives scheme (PLI) for several sectors including air conditioners and LED lights.

In crackdown on fake GST invoices, 258 arrested since November: Report

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As many as 258 people have been arrested since mid-November during the government's crackdown on fake GST invoices.

More than 2,500 cases have been registered against 8,000 entities since mid-November, as a part of the government's crackdown on fake goods and services tax (GST) invoices.

As many as 258 People Have Been Arrested including eight chartered accountants, Mint reported. Fake GST invoices are used to fraudulently avail input tax credit (ITC).

The government has asked the Institute of Chartered Accountants of India (ICAI) to take action against the accountants, the report said.

Authorities have recovered more than Rs 820 crore from the accused, a government official told the business newspaper.

The last chartered accountant (CA) who was arrested was taken into custody in Jaipur on January 23 along with four business accomplices, Mint said. 

Data was shared between GST, income tax and customs, which helped spot violations, the report said. Data analytics and artificial intelligence were also used to identify frauds.

Authorities have also identified the final beneficiaries, which includes two major ecommerce firms, the report said.

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