The Insurance Regulatory and Development Authority of India (IRDAI) has brought in several reforms in health covers aimed to benefit policyholders.
The new norms will require insurers to approve cashless claims within an hour and provide final authorisation for discharge from a hospital within three hours.
Insurers will also need to provide a one-month grace period for annual renewal of health policies and protect benefits under policies renewed within that period.
IRDAI has issued a master circular on health insurance products that comes into effect immediately (with certain exceptions).
Under the new norms, insurers have to ensure that hospitals release mortal remains immediately in the event of a death during treatment. Companies cannot repudiate a claim without the approval of a Claims Review Committee.
Document collection
For settlement of claims, insurers and TPAs (third party administrators) must collect documents from hospitals and not call for them from the insured. Policyholders with multiple health insurance policies can select the policy under which they claim the admissible amount. The primary insurer will coordinate the settlement of the balance amount from other insurers.
The new rules allow insurers to reward policyholders with no claims during the policy period by offering either an increased sum insured or discounted premium amounts.
Policyholders, who want to cancel their policies, can receive a refund of the premium for the unexpired policy period. All individual health insurance policies are renewable and cannot be denied on the basis of previous claims, except in cases of fraud, non-disclosure, or misrepresentation. No fresh underwriting is required unless there is an increase in the sum insured.
Under the new norms, insurers have been asked to move toward 100% cashless claim settlements and have been directed to empanel all categories of hospitals and healthcare providers, considering the affordability for different population segments.
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