Updated and reposted on 14.06.2024
The master circular on Health Insurance products repeals 55 circulars issued earlier and is a significant stride towards reinforcing the empowerment of policyholders and bolstering inclusive health insurance, Irdai said in a statement.
IRDAI has issued several new guidelines in 2024, making health insurance more inclusive for all. Important guidelines are as follows;
- Insurance companies are under obligation to provide a Customer Information Sheet (CIS) to their policyholders according to the Insurance Development Authority of India (IRDAI) guidelines. The document will furnish complex policy details and offer policyholders a clear understanding of their insurance coverage concerning sum assured, coverage specifics, exclusions, and claims procedure.
- Insurers / TPA should approve cashless claims within 1 hour. Regulator Irdai’s master circular on health insurance specifies that an insurer will have to decide on cashless authorization within one hour of request.
- Final authorization for hospital discharge within 3 hours of request by the hospital. Insurers are to decide on final authorization on discharge from the hospital within three hours of intimation/request,”
- IMPORTANT – for settlement of claims, the insurer / TPA must collect documents/queries from hospitals directly. The insurer/TPA should NOT call for documents from the insured (policyholder).
- One-month grace period for annual renewal of medical policies. (Policy will be protected up to 1 month from the expiry of the policy
- Policyholders with NO CLAIMS, are to be rewarded with an increased sum assured OR discounted premium (at the time of renewal)
- 30-day free-look period: The free-look period for reviewing policies is mandatorily extended to 30 days from the date of receiving the policy document, regardless of the mode of acquisition (online, physical, etc.). This additional time enables policyholders, to compare policies from different companies and make well-informed decisions after meticulously assessing the policy details, encompassing coverage, exclusions, terms, and conditions, before arriving at a final decision.
- All medical insurance policies are renewable and renewal CANNOT be denied because of previous claims (except in case of fraud, or misrepresentation).
- . An insurance company cannot reject a claim citing non-disclosure of illness after 60 months. A health insurance company cannot reject a claim of a policyholder citing non-disclosure of pre-existing illnesses, except in cases of proven fraud, after 60 months of continuous coverage. That is, if you have paid five annual premiums, your claim will not be rejected on the grounds of suppression of health status or misrepresentation unless that insurer can prove fraud. Earlier, this waiting period was 96 months called the moratorium period. The insurance company cannot appeal to the IRDA against the settlement of such claim except for fraud and/or a claim raised against the exclusion of the policy after the moratorium period.
- Insurers are to settle claims within 7 days, and surveyors are to submit reports within 15 days.
- customers can now opt for insurance policies that span less than a year, annual, or even more than a year providing more choices to fit individual needs and preferences.
- Removal of entry and exit age: The IRDAI has removed the entry age limit reference for insurers to offer health insurance plans in India. Earlier, insurance companies had to typically offer health insurance with an entry age of at least up to 65 years. However, the new guidelines eliminate this age reference, mandating insurers to provide health policies for people of all age groups. This guideline is especially helpful for senior citizens, who have the freedom to buy a comprehensive medical policy whenever they want.
- Mandated maximum waiting period for pre-existing illness: The mandated maximum waiting period for pre-existing conditions or illnesses has been shortened from four years to three years. A medical illness or injury that you have before you start a new health care plan may be considered a pre-existing condition. Conditions like diabetes, asthma, high cholesterol, or a long-term back condition may be examples of pre-existing health conditions. They tend to be chronic or long-term. That is, if a policyholder is suffering from, the above health conditions, your insurer will pay hospitalisation claims after you have paid at least three premiums (down from four earlier). A mandatory shorter waiting period of three years will make the process easier for policyholders. However, if insurers offer shorter waiting periods than the mandatory shorter waiting period mandated it is left to the policyholders to do homework and zero in on such policies.
- Online consultation included in the coverage: The fee paid for online consultations can amount to a large sum that would be proven to be a financial loss to the insured person. IRDA has asked health insurance companies to include telemedicine in the coverage where applicable. This move has allowed medical practitioners and patients to freely avail medical opinions.
- Delayed claim settlement: In case of a delayed claim settlement by the insurer, the company is liable to pay the interest on the claim amount at a rate of 2% more than the bank rate. The claim should be settled within 30 to 45 days from the date of communicating the last required document to the policyholder. The time duration for claim settlement will depend upon the nature of the claim and the investigation required.
- Multiple health policies: If a policyholder has multiple health policies, he/she can choose to raise a claim at a preferred insurance company and the insurer will be liable to settle the claim as per the terms and conditions of the policy. The policyholder is entitled to choose a claim from another insurer for an amount disapproved by the first insurer, by raising a claim for the balance amount with another insurer in case of multiple policies. This rule applies when the sum insured is exhausted under the first policy.
- Health Insurance Portability: A health insurance policyholder is free to shift his/her policy to another insurance company with a new plan of a similar nature in case he/she is not satisfied with the services provided by the insurance company. IRDA has created a web-based facility to get and maintain data about all health insurance policies issued by insurance companies to individuals so that it can be accessed by the new company to which a policyholder wishes to port his policy. This enables the new insurer to obtain data on the history of health insurance of the policyholder wishing to port his policy.
- Portability of policy only during the renewal of the policy:
- You can port the policy only at the juncture of renewal. That is, the new insurance period will be with the new insurance company. When you change your health insurance policy from one insurance company to another, you don’t have to lose the benefits you have accumulated. The new insurer “shall allow for credit gained by the insured for a pre-existing condition(s) in terms of waiting period”. In the past in health insurance policies, such a move resulted in your losing benefits like the waiting period for covering “Pre-existing Diseases”. This applies not only when you move from one insurer to another but also from one plan to another with the same insurer. Your new insurer has to insure you at least up to the sum insured under the old policy.
- A policyholder may migrate to another plan offered by the current insurance company or migrate to a new plan with another insurance company only at the juncture of renewal. Apart from the waiting period credit, all other terms of the new policy including the premium are at the discretion of the new insurance company. At least 45 days before your renewal is due you have to write to your old insurance company requesting a shift your policy to a specific company to which you want to shift the policy Renew your policy without a break (there is a 30-day grace period if porting is under process).
IRDAI has removed sub-limits on AYUSH treatments. With this guideline, policyholders will be able to claim the cost of treatments availed through Ayurveda, Yoga, Naturopathy, Siddha, Unani, and Homeopathy systems of medicine up to the sum insured limit.
The insurance regulator has asked insurers to design customized medical insurance products for senior citizens, children, maternity, students, and other groups. This will encourage insurers to diversify their product portfolio and enable people from these specialized groups to choose the best health insurance plan specific to their needs.
The IRDAI has also asked insurers to formulate a specialized channel to handle the claims and complaints of senior citizens. This will ensure a more responsive and tailored approach to meet the requirements and settle the grievances of senior citizens.
The IRDAI has directed insurers to issue only benefit-based policies to cover hospitalization expenses and prohibited them from introducing indemnity-based policies. This will ensure that a fixed sum is paid to policyholders upon the diagnosis of a covered disease.
The insurance regulator has also prohibited health insurance companies from refusing health policies to people with severe pre-existing diseases, such as heart disease, cancer, renal failure, and AIDS. This will ensure a more inclusive medical insurance ecosystem and increase its penetration in India.
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