The move to set up another company comes months after Jagannathan abruptly quit as chairman of the company he started and nurtured into the Rs 37,000-crore health insurer it is today.
Sources say, there is no non-compete clause that Jagannathan has signed with Star Health. While the Companies Act has age limits on the maximum age for a chief executive or a board member, Jagannathan is free to be a promoter.
Industry sources said that having cashed out of Star Health, Jagannathan has the resources to set up a health company. He also has potential investors. Industry persons said that the health insurance business has been growing at over 30%, and the entry of new players will not impact Star Health. “The disruption in health insurance is more due to the unhealthy competition for group health insurance in the pursuit of top line growth,” said the CEO of a private non-life company. He added that the public sector insurers had started quoting viable rates after pressure from the finance ministry a couple of years earlier to get their books in order. However, their quotes for group Mediclaim are getting aggressive yet again.
According to a report by Milliman, health insurance is expected to experience high growth in the post-covid years due to increased awareness levels.