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Changes to Health Insurance Laws Over Time

15 September 2022, 11:55 AM

A lot has changed over the course of time regarding health insurance. The list of disease coverage keeps getting amended by the IRDAI. Insurers are made to comply with the regulations to do health insurance business without interruption. Similarly, the IRDAI ensures policyholders find themselves at ease while paying their health insurance premiums by introducing comfortable options for them. What also makes the IRDAI act is the numerous complaints and suggestions the regulatory body receives from policyholders and industry representatives. Taking note of the same, the IRDAI enforces new regulations to ensure transparent and fair trade practices in the health insurance segment. The latest regulations from IRDAI came in 2020.

This article explains the function of the Insurance Regulatory and Development Authority (IRDAI) within the context of health insurance. Let's get started!

What is the IRDAI?

The Insurance Regulatory and Development Authority is sometimes abbreviated as IRDAI. IRDAI is defined here. India's Insurance Regulatory and Development Authority was established to improve and expand India's insurance sector. In 1999, it was proposed that IRDAI be established as a separate organisation. But in April 2000, it was made a statutory organisation by the Indian government to regulate the insurance industry.

As with every other sector, insurance business fashions are ever-evolving. The rise of online insurers and the international spread of cutting-edge insurance technologies have contributed to this shift. Standardisation rules are updated regularly to assist IRDAI in staying current. The IRDAI released new recommendations for 2020, the most recent revision.

Modifications to Healthcare Insurance Standards

#1. Amendments Made to Include Mental Illness, Genetic Problems Under Health Insurance Coverage

These new regulations will provide all people with access to care for conditions such as mental illness, age-related decline, behavioural and neurodevelopmental problems, genetic illnesses, disorders of puberty and menopause, internal congenital diseases, and artificial life support.

In addition, insurers cannot deny coverage for injuries or illnesses sustained in potentially harmful situations. The program would also pay for the treatment of age-related conditions, including cataracts and knee replacements.

#2. Inclusion of COVID in Regular Health Insurance

Regular health insurance plans include coverage for COVID treatment expenses, and there are specific plans for the same. IRDAI had instructed the insurers to include the same in their regular health insurance policies during the outbreak of COVID in 2020. 

#3. Increased Coverage

Telemedicine is now more widely covered under health insurance, helping to offset the growing gap between patients and doctors. Insurers have been urged to permit claim payment for telemedicine consultation following the terms and conditions of the insurance contract after the MCI released guidelines allowing registered medical practitioners to offer healthcare through telemedicine.

#4. Standardisation

Policymakers have provided uniform language for necessary provisions such as significant facts disclosure, claim settlement, policy cancellation, etc., making it more straightforward for policyholders to evaluate plans from different providers. In addition, customers may have access to additional terms and conditions if they so want.

#5. Health Insurance EMIs

The insured can pay their premiums over time via EMIs, offering them more financial freedom. However, the specifics will vary as per the health insurance provider.

#6. Proportional Deductions Norms

Because consultation costs and the like grow proportionally with a higher category of hospital room, policyholders who pick a higher classification of the room than what is permitted by the capping of insurance policy would benefit significantly from the instructions published on proportionate deductions of claims.

According to the new regulations, associated medical costs must be included in the contract. Consequently, it's possible that expenses like pharmaceuticals, medical implants, and diagnostic tests would be disallowed.

In addition, insurers are not permitted to provide any pro-rata reduction for ICU expenses due to the impossibility of further subcategorising ICUs.

#7. 8-Year Claims Can't Be Rejected

A health insurance claim cannot be denied if the policyholder has maintained continuous premium payments for eight years or longer unless the insurer can prove fraud or the policyholder is permanently excluded from coverage. The eight years is a moratorium.

#8. Health Advantages

Recent rules emphasise compensating policyholders based on preventative and wellness activities to incentivise healthy lifestyles. To do this, the prospectus and policy document will provide up-front information about any processes or incentives that will be in place to encourage people to keep tabs on their health and make necessary improvements.

#9. Many Pilot Products

With the help of the IRDAI, insurance firms have introduced many new health insurance packages to address hazards formerly excluded from such plans. In addition, health insurance companies are encouraged to experiment with new products and to take advantage of the unique continuity advantages.

#10. Faster Turnaround

Following the new rules, health insurance claims must be resolved or rejected within 30 days of receipt by the insurer. In addition, the insurance business may face fines for any delays. This came into existence to provide better health insurance as all classes of families can't procure the cost of surgery.


Due to these laws, there will be a tsunami of change in how the health insurance sector does business and interacts with its consumers, but the future looks bright for the industry as a whole. Health insurance expansion will be aided by numerous demographic trends, including an expanding middle class, a younger insurable population, and a rising awareness of the need for sufficient coverage.

Currently, only a few Indians have health insurance. With the current changes, that number is projected to rise.

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1. What are IRDAI regulations on COVID Coverage?

IRDAI mandates every insurer to cover COVID treatment under their regular health insurance policies. Besides, IRDAI is making insurers provide dedicated COVID policies to their customers - Corona Rakshak and Corona Kavach.

2. Can a claim be denied for a policyholder with a 10-year policy?

According to the new rules, policyholders whose health insurance for surgery is filed after the eight-year waiting period would not be denied coverage.

3. When it comes to mental health, will medical insurance cover it?

Affective disorders will be included, so yes.

4. Can my insurance company reject my diabetes claim after nine years of renewals?

If you have renewed your Health Insurance for Surgery policy without a lapse in coverage for eight years or longer, your provider is prohibited under the new guidelines announced by IRDAI from denying payment for pre-existing conditions

5. What is the grace period of health insurance?

The grace period of health insurance can be either 15 or 30 days from the policy expiration date.

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