Medical insurance plans: seven companies ordered to pay a fine by the Competition Commission

Seven insurance companies, found guilty of violating article 41 of the Competition Act 2007 were ordered by the Competition Commission, this Thursday, October 7, to pay fines totaling some Rs 11.3 million.

The Competition Commission has determined that these firms broke the law by reaching an agreement on the reimbursement amount for medical insurance plans. This is a violation of section 41 of the Competition Act 2007, according to a press release issued by the Commission on Thursday, October 7.

These companies are part of the Association of Private Health Plans and Administrators. The amount of the fine imposed is estimated at approximately Rs 11.3 million. This sum was reduced by leniency by the Commission because these companies showed their willingness to collaborate for the needs of the investigation.

What article 41 of the Competition Act 2007 stipulates

Article 41 of the Competition Act 2007 prohibits any collusive agreement between competitors with regard to fixing the price of their products and the amount of reimbursements, among other things …

Of the three agreements evaluated, two pose a problem: the one concerning the ‘common scale of cost’ linked to gynecological treatments but also the agreement between certain members of the association for treatments abroad. Thus the agreement concluded allowed a limitation of the reimbursement threshold to the customer, according to the Commission.

The insurance companies cited and affected by the payment of this fine are Swan General Limited, Mauritius Union Assurance Company Limited, Eagle Insurance Limited, Sicom General Insurance, Jubilee Insurance Mauritius Limited, Medscheme Mauritius Limited and Linkham Services limited, indicates this communicated.

These companies obtained a reduction in the fine for agreeing to cooperate with the commission on the investigation and they agreed to pay this penalty. Penalties which vary between more than Rs 6 million and Rs 45,000, calculated in accordance with the turnover of each of them.

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