Standard well being insurance coverage policies used to be more affordable but capping on each day area rent, ICU charges and so forth causes issues for policy holders. On the other hand, premium goods do not include most of the constraints and are more user friendly, but are costly.
However, just after the policies are becoming standardised as per the directive of the Insurance Regulatory and Development Authority of India (IRDAI), policyholders are receiving renewal notices with greater premium even if there are no alterations in age slab or the sum insured.
So, what attributes the newly standardised goods are providing to make them costly?
“IRDAI introduced modified guidelines to Standardise the Health Insurance Contracts which aimed at introducing standard wordings for common clauses and exclusions across health insurance indemnity policies to benefit the policyholders by bringing in uniformity in the Policy terms and conditions, help in simplification and ease in understanding the policies,” stated Mayank Bathwal, CEO, Aditya Birla Health Insurance.
“With this standardisation there were certain conditions which were excluded earlier are now offered to the policyholders like coverage for Procedures such as Robotic Surgery, Oral chemotherapy, High Intensity Focussed Ultrasound, Balloon Sinuplasty, Deep Brain Simulation, Developmental problems & learning difficulties like dyslexia and Treatment for ARMD (Age related macular degeneration),” he added.
“Certain clauses like Disclosure of Information, Claim Settlement (provision for Penal Interest), Complete Discharge, Multiple Policies, Fraud, Cancellation, Migration, Portability, Renewal of Policy, withdrawal of Policy, Free look period, Redressal of Grievance, Nomination etc are now Standardised,” Bathwal additional stated.
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According to Girish Rao, Chairman & Managing Director, Vidal Health Insurance TPA, “During 2020, with a view to simplifying Health Insurance products, IRDAI issued guidelines to standardise some terms and conditions for Health policies such as disclosure of information, claim settlement terms, cancellation, and renewal of a policies etc. Much earlier they had mandated portability of health policies. They also asked insurers to clearly declare norms of Associate Medical Expenses and allowance for Disability and HIV etc.”
“We think this standardisation of terms and products across insurers will go a long way in increasing the penetration of Health Insurance among large masses. The simplified policy terms will be competitive and drive lower premiums. The result was there to see with an amazing take up of Covid policies. Large corporates as well as Individual customers subscribe to these policies in large numbers,” Rao additional stated.
But how a lot is the typical enhance in premium just after the standardisation?
“With standardisation of health insurance, insurance cover for policyholders is now more exhaustive and is available with no change in the premium for the majority of the products and a marginal increase in a couple of products,” stated Bathwal.
Negating the reports of rise in premium, Rao stated, “We have not seen any increase in premium so far. There may have been some increase in cost per claim due to implementation of Covid protocols in Hospitals but I think this is short term. As soon as vaccinations reach a critical mass we should see these costs come down.”
Although well being insurance coverage players are reluctant to reveal the quantum of rise in premium, holders of even policies with even premium attributes have witnessed a rise in renewal premium.
The quantum of rise in renewal premium, nonetheless, varies from insurer to insure and item to item.
For instance, the holder of the fundamental version of a premium well being insurance coverage item has witnessed 19.45 per cent enhance in renewal premium, although the holder of the greater version of the exact same item has reported practically 16 per cent enhance in renewal premium.
So, along with standardisation of attributes of the well being insurance coverage policies, the insurance coverage regulator should really look at standardisation of premium as effectively.