Lockdown, isolation and quarantine were the words that terrified us all a few months ago. Who would have thought these words would significantly impact our daily lives beyond just health? The virus devastated the economy, forcing millions to deal with financial hardship and losses. Due to the increasing cost of hospitalisation and related medical bills, there has been a notable interest in learning about and acquiring health insurance.
Since buying health insurance is not mandated by law, a prospective policyholder has total flexibility in selecting a plan. But how can a policyholder have faith in an insurer?
IRDAI's guidelines and rules for health insurance come into play in this situation.
Let's first examine what IRDAI is and how it operates.
The Insurance Regulatory and Development Authority of India, or IRDAI as it is also known, is the primary regulatory body that oversees the insurance sector in our country. Its main objective is to further the industry's growth as a whole and safeguard the interests of policyholders.
Main Objectives of IRDAI
- To put the insurance law's provisions into practice.
- To safeguard the insured's interests and ensure their treatment is just.
- To ensure the financial stability of the insurance sector, oversee it fairly.
- Formulate regulations to guarantee transparent business practices.
The interests of the policyholders are at the centre of IRDAI's activity to guarantee the fairness and financial stability of the sector. The following are the primary activities in which the autonomous body is involved:
- Issue new insurance businesses registration certificates.
- Create policies and guidelines to ensure the insured's interests are upheld.
- Ensure that no insurance firms voluntarily deny any claim and that claims are arbitrarily determined.
- IRDAI inspectors regulate insurance businesses, insurance intermediaries, and other insurance sector norms to give resolutions in the event of disputes.
- To prevent unforeseen premium price spikes, manage and modify insurance premium rates.
- Setting the minimum percentage restrictions for general and life insurance businesses to expand in the urban and rural sectors.
IRDAI Rules for Health Insurance
The IRDAI has exhaustively outlined several requirements that must be followed. These regulations make it easier for the insurer and the insured to offer and get a reasonable deal on health insurance and related services. They are as follows:
- A health insurance policy may not have an exit age if the policyholder renews it on schedule (without any interruptions in renewal).
- The insurance company is responsible for providing policyholders with information regarding the terms and conditions of a health insurance policy about care at medical institutions across India.
- Policyholders will receive rewards if they renew their coverage on time, purchase it early in life, or have a positive claims experience with an insurance provider. Therefore, the prospectus and policy document should include explicit references to the benefits (as agreed by the board).
- The insurance provider must give applicants a fair, justifiable, and open explanation in writing if their request to purchase health insurance is declined.
- Before issuing the policy, the insurance company should give the policyholder a list of medical facilities (government or otherwise) from whom the firm will accept the medical reports.
- The insurance provider must give the policyholder a choice to switch to another plan after meeting the exit conditions for specific health insurance policies that provide coverage to a particular group of individuals (such as children under a certain age, students, pregnant women, etc.) Additionally, award appropriate credits if the policy was renewed without any gaps.
- The premium amount should be reasonable, equitable, and transparent for seniors. Additionally, the total sum should be made clear to the potential policyholder.
IRDAI's New Rules for Health Insurance Policy
The IRDAI guidelines for health insurance in 2020 put a lot of emphasis on issues like using multiple plans and settling claims. They apply to health insurance applications submitted after October 1, 2020. In addition, the terms and conditions for renewed products beginning on or after April 1, 2021, were also changed to conform to the regulations.
Rejection of Claims
If the policyholder renews the policy without a pause, the health insurance company cannot deny a claim. The eight years will be referred to as the moratorium era. Except for fraud and/or a claim brought against the policy's exclusion after the moratorium period, the insurance company cannot appeal to the IRDAI against the settlement of such a claim.
Health Insurance Coverage for Telemedicine
The COVID-19 pandemic compelled patients and healthcare professionals to offer and access remote consultations. However, these online consultations can be costly for the insured person. Therefore, the IRDAI has asked health insurance providers to cover telemedicine where appropriate. Medical professionals and patients can now openly access medical opinions thanks to this decision.
Claim Settlement
The insurance company is responsible for paying interest on the claim amount at a rate of 2% higher than the bank rate if the insurer delays settling a claim. The claim should be resolved within 30 to 45 days of the policyholder receiving the final required paperwork. The length of time will depend on the claim type and the necessary research.
Numerous Policies
The insured may file a claim for an amount rejected by an insurer by filing a claim for the remaining amount with another insurer. This is valid even if a single policy's maximum insurance coverage is reached.
Health Insurance Portability
If a policyholder is dissatisfied with the services offered by the insurance company, he or she may decide to switch to a new plan of a comparable sort.
Conclusion
The rules that IRDAI introduces are for the greater good. First, it provides necessary mechanisms to insurance companies who wish to bring out more innovative products in the market at a faster frequency. On the other hand, customers can select the insurance policy that best meets their needs from various insurance options, protecting their life from any unforeseen circumstances.
