In its draft guidelines on health insurance policies, Insurance Regulatory and Development Authority (IRDA) has suggested sweeping changes. Once these guidelines come into effect, it will not only be beneficial for policyholders but it will also increase the transparency of the business.
Draft Guidelines
Entry age: IRDA has recommended that anyone up to the age of 65 years can buy a health insurance product. It will be beneficial for senior citizens as till now insurers could deny health cover for people over 60 years as it was not mandatory.
Renewability: IRDA has also suggested lifetime renewability of health insurance product. Till now insurer had set the renewability age at just 50-55 years based on past claims.
Hospitalization: If these guidelines come into effect, than the preferred network of hospitals clause will be removed. That means you don’t have to find a hospital which has an agreement with your insurer at the time of need, you can go to any hospital for the treatment.
Policy document: IRDA has also sought more clarity from the insurer at the time of policy issuance and settlement. For the customer’s ease a standard policy form will be issued, which will highlight the important policy details for the customers.
The policy document will also required to mention the cumulative bonus that a policyholder earns. Insurer rewards policyholder with bonus, if he doesn’t make any claim for a specified period.
Settlement: At the time of settlement, IRDA has introduced a form asking insurance company to provide clear reasoning for claim rejection.
Insurer is also required to provide detailed explanation at the time of loading of the policies. Loading refers to the increase in the premium after the claim has been made.
Multiple policies: If you have more than one health insurance policy, you can get your claim settled by any of the insurer. It is left to the Insurers to settle the bill amongst them later. Earlier insurers had to share the claim payouts which lead to delay in claim settlement.
Alternative treatments: IRDA has proposed that non-allopathic treatment in government recognized hospitals should come under the ambit of health insurance.
Standard definitions: Due to absence of standard definitions insurers were rejecting claims. Hence, there will be definitions for many terms.
Medical reimbursement: You will get a full refund for the medical test you undertake before taking a policy. The medical reimbursement for the policyholder is pegged at 50% for non-life insurance policy and 100% for life insurance policy.
Policy tenure: IRDA has proposed that any policy of Life Insurance Company should have minimum tenure of four years while any health insurance policy by general insurer should have maximum tenure of three years. Rationale behind this move is that longer tenure allows better servicing of the policy.
However, insurers are not excited with the guidelines as per them it has some suggestions that restrict competition and innovation in the industry.
Draft Guidelines
Entry age: IRDA has recommended that anyone up to the age of 65 years can buy a health insurance product. It will be beneficial for senior citizens as till now insurers could deny health cover for people over 60 years as it was not mandatory.
Renewability: IRDA has also suggested lifetime renewability of health insurance product. Till now insurer had set the renewability age at just 50-55 years based on past claims.
Hospitalization: If these guidelines come into effect, than the preferred network of hospitals clause will be removed. That means you don’t have to find a hospital which has an agreement with your insurer at the time of need, you can go to any hospital for the treatment.
Policy document: IRDA has also sought more clarity from the insurer at the time of policy issuance and settlement. For the customer’s ease a standard policy form will be issued, which will highlight the important policy details for the customers.
The policy document will also required to mention the cumulative bonus that a policyholder earns. Insurer rewards policyholder with bonus, if he doesn’t make any claim for a specified period.
Settlement: At the time of settlement, IRDA has introduced a form asking insurance company to provide clear reasoning for claim rejection.
Insurer is also required to provide detailed explanation at the time of loading of the policies. Loading refers to the increase in the premium after the claim has been made.
Multiple policies: If you have more than one health insurance policy, you can get your claim settled by any of the insurer. It is left to the Insurers to settle the bill amongst them later. Earlier insurers had to share the claim payouts which lead to delay in claim settlement.
Alternative treatments: IRDA has proposed that non-allopathic treatment in government recognized hospitals should come under the ambit of health insurance.
Standard definitions: Due to absence of standard definitions insurers were rejecting claims. Hence, there will be definitions for many terms.
Medical reimbursement: You will get a full refund for the medical test you undertake before taking a policy. The medical reimbursement for the policyholder is pegged at 50% for non-life insurance policy and 100% for life insurance policy.
Policy tenure: IRDA has proposed that any policy of Life Insurance Company should have minimum tenure of four years while any health insurance policy by general insurer should have maximum tenure of three years. Rationale behind this move is that longer tenure allows better servicing of the policy.
However, insurers are not excited with the guidelines as per them it has some suggestions that restrict competition and innovation in the industry.
IRDA has suggested that anyone up to the age of sixty five years can purchase a health insurance product. The policy document also will needed to say the cumulative bonus that a policyholder earns.
ReplyDeleteJonathan
Without any doubt a health insurance policy is must for everybody bit before choosing one you must see for both benefits and drawbacks, thanks nisha
ReplyDeleteWithout any doubt a health insurance policy is must for everybody bit before choosing one you must see for both benefits and drawbacks, thanks nisha
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