Purchase health insurance at an early age, before you incur a disease, as this makes access to health insurance difficult and raises the premium significantly.
The Insurance Regulatory and Development Authority of India (Irdai) issued a master circular on health insurance on May 29, 2024, listing 20 provisions.
These norms, if properly implemented, will make health insurance simpler, more accessible, and a reliable instrument for protecting customers' interests.
"The master circular encourages insurers to adopt customer-centric policies. This can positively impact insurance penetration," says S Prakash, managing director/chief executive officer designate, Galaxy Health and Allied Insurance.
"It will lead to a UPI-like movement -- deeper penetration and higher adoption--within the health insurance ecosystem," adds Prakash.
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Proportionate refund of premiums
Previously, if a customer purchased a health insurance policy and decided to discontinue it during the policy term, she would receive a refund based on a 'short-premium scale'.
For example, if s/he had used the policy for three months, the insurer would deduct six months of premium. If s/he had used it for six months, the insurer would deduct nine months' premium, and so on.
Now, after the free-look period of 30 days, a customer can cancel the policy with a seven-day notice and get a proportionate premium back, unless she has made a claim.
"The insurer will only deduct the premium for the period for which the policy was used. This change provides greater flexibility to people who wish to discontinue their policy," says Kapil Mehta, co-founder, SecureNow.
Reduction in moratorium period
The moratorium period has been reduced from eight years to five. Previously, after eight years, an insurer could not deny a claim except in case of an established fraud.
"This means claim payment will become assured sooner," says Mehta.
Prospective customers should not turn complacent.
"While purchasing a policy, declare your medical history, current health status, and lifestyle habits (like smoking) comprehensively," says Siddharth Singhal, business head-health insurance, Policybazaar.com.
Cashless approval within an hour
The regulator wants insurers to achieve 100 per cent cashless claim settlement and minimise settlement through reimbursement. The request for cashless authorisation must be decided immediately or within one hour.
Insurers must set up helpdesks at hospitals and provide pre-authorisation via digital modes. They must put the necessary systems in place by July 31, 2024.
"The regulator's emphasis on shifting 100 per cent claims to cashless settlement will ease policyholders' financial burden," says Naval Goel, CEO, PolicyX.
Cashless treatment is available only at network hospitals.
"Verify if your preferred hospitals are in the insurer's network and understand the cashless claim process to avoid last-minute issues," says Pooja Yadav, chief product officer, Zuno General Insurance.
Discharge within three hours
Patients have often been held up at the hospital for hours after discharge because the insurer had not settled their bill. Some have incurred additional costs for spending an extra night at the hospital.
The regulator has mandated that if there is any delay beyond three hours, the insurer must bear the additional cost.
"In the future, if there is any delay from the insurer's side, do not pay the additional waiting charges," says Goel.
Coverage for high-tech treatments
The regulator has urged insurers to cover high-tech treatments hospitals are adopting.
"Health outcomes are improved by including coverage for procedures such as robotic surgeries, oral chemotherapy, and stem cell therapy," says Rakesh Jain, CEO, Reliance General Insurance.
While many policies cover high-tech treatments, some have sub-limits for them.
Jain says customers should review their policy carefully and remain informed about the specifics of the coverage offered by it. If your policy does not fully cover such treatments, consider porting.
Points customers must pay heed to
While the master circular sets many laudable goals, like making policies more inclusive, customers need to watch out for a few things.
For many -- senior citizens, those with pre-existing diseases (PEDs), etc -- while policies may be available, they may be expensive.
Purchase health insurance at an early age, before you incur a disease, as this makes access to health insurance difficult and raises the premium significantly.
While the master circular urges insurers to offer a wide variety of policies, customers on their part must make appropriate choices.
"Consider your family conditions and choose insurance features such as OPD (out-patient department) coverage, maternity benefits (if planning for a family), global coverage for frequent travellers, and modern treatment coverage," says Jain.
Utilise the enhancement in free-look period from 15 to 30 days.
"Read the policy document thoroughly, focusing on terms and conditions, exclusions, waiting periods, and coverage limits to ensure the policy meets your needs," says Yadav.
Goel suggests not buying policies from insurers who do not offer no-claim bonuses as these bonuses are useful in combating medical inflation.
"Avoid plans with sub-limits related to modern treatments, room categories, or diseases," says Singhal.
Claims using multiple policies
Policyholders with multiple policies can choose which one to use (that insurer becomes primary insurer).
If the hospital bill exceeds the sum insured of the first policy, primary insurer shall coordinate with other insurers to settle balance amount
Impact: Claim settlement likely to become easier for customers with multiple policies
Customer information sheet
Aims to provide key information about policy at one place
Impact: Customers won't have to go through scores of pages of fine print
Ombudsman's award
Insurers must comply with ombudsman's award within 30 days, or they will be liable for a penalty of Rs 5,000 per day
Impact: Insurers likely to comply with greater alacrity
Feature Presentation: Ashish Narsale/Rediff.com
