Costly Covers, Better Care
Outlook Money|November 2020
Annual health insurance premium may see a sudden surge as the regulator’s diktat widens health coverage, making health policies more inclusive and less complicated
Debjoy Sengupta

The pandemic has truly changed our life’s worth. Today we are extremely careful about things we would seldom care about before. Take, for example, health insurance. Everyone’s running for cover. Hospital bills are running into lakhs of rupees. Social media like Twitter, Facebook, and others are flooded with complaints on claim rejection, non-payment, and reimbursement settlement delays. In fact, many were left with a deep hole in their pockets, settling a major chunk of their bills in cash as hospitals chose to charge patients even for doctors’ safety gear. These were not covered under health insurance.

Policyholders were often left wondering about the fate of their claims. While some policies covered one set of illnesses, others covered a diverse group of diseases, with different premiums and clauses. It was a nightmare. However, a quick intervention from the regulator has paved the way for a better standardized health insurance order.

The Insurance Regulatory Development Authority of India (IRDAI) has mandated that all general and health insurers offer standard individual health insurance products. This was implemented from October 1. 2020. For customers, it means insurance cover for more illnesses and procedures. Now pre-existing diseases include any health condition that has been diagnosed 48 months before the issuance of the health policy and a medical condition that develops within three months of policy issuance. Also, stress, mental illness, telemedicine, high tech surgeries are now covered under health insurance.

While buying insurance products has become less complicated, it has spiked up the cost of the premium, making the policy costly.

IRDAI prepared an exposure draft on “Guidelines on Standardisation of General Clauses in Health Insurance Policy Contracts” in January 2020.

Product Uniformity

The idea is to allow buyers to pick and choose without going through the tedious process of comparing products and clauses. In other words, health insurance policies have been made more inclusive and less complicated.

Commenting on the development, Surendra Bagri, Promoter of Axiom Insurance Brokers, says, “Standardisation of health insurance rules by IRDAI is a very welcome and landmark move. It will be easier to compare products, widen coverage and remove ambiguities.”

Bagri’s firm, an insurance broking house, advises individuals on buying the right insurance policies. It facilitates them on renewing policies and, if necessary, switch to the best available product.

New Diseases Covered

As per the new guidelines, insurance companies can no longer exclude diseases like HIV, mental illness, stress, and psychological disorders. Illness contracted through hazardous activities, treatments for age-related conditions, internal congenital disorders, and genetic disease will be covered as well.

Continue reading your story on the app

Continue reading your story in the magazine

MORE STORIES FROM OUTLOOK MONEYView All

In Cold Storage?

Logistics stocks zoomed due to news about COVID-19 vaccines. But adverse political and financial factors may reverse the trend

7 mins read
Outlook Money
January 2021

Don't Back These Buys

Buybacks help you to save taxes and earn premiums over market prices. But if you participate in them, they can eliminate the possibilities of higher profits later

4 mins read
Outlook Money
January 2021

One Size Doesn't Fit All

The new standard term insurance plan is easy to understand, and perfect for first-time buyers and low-income individuals. But the sum assured is low, and it is a pure-risk plan

3 mins read
Outlook Money
January 2021

Greater Expectations

FM has to decide whether to feel optimistic or pessimistic about the future. Either way, she has to focus on reforms and growth

10 mins read
Outlook Money
January 2021

Education redefined

Multi-skilling is the new trend in globalised PhyGital learning

5 mins read
Outlook Money
January 2021

2021: Year Of Small-Caps?

Smaller stocks may outperform the others this year. The rise can be 30 percent more than in headline indices

4 mins read
Outlook Money
January 2021

The Cryptic Crypto-World

Digital currency is the new asset category. But risks are high due to volatility, lack of

6 mins read
Outlook Money
January 2021

Common Man's Wishlist

FM needs to hike deductions under 80D, and lower capital gains tax

3 mins read
Outlook Money
January 2021

SENSEX-30 OR BSE-500

The rally, which was hitherto restricted to large-caps, has begun to spread to mid-caps and small-caps. But volatility will continue and this will not be a completely secular boom

7 mins read
Outlook Money
December 2020

Money Spinning Mid Caps?

With stringent regulatory compliances, large companies are likely to grow and smaller ones may get wiped out, but mid-sized ones to offer much hope, says Dhiraj Relli, Managing Directors, HDFC Securities, during an interview with Yagnesh Kansara and Debjoy Sengupta. Edited excerpts.

4 mins read
Outlook Money
December 2020