The Insurance Regulatory and Development Authority of India(IRDAI) is the insurance sector regulatory body in India. The IRDAI’s objective is to optimise the existing insurance industry and make sure the operations and conduct of the sector are fair. The insurance market is undergoing constant changes, upgradation, and high competition. Consequently, the role of the IRDAI is essential.
IRDAI rules for health insurance
The IRDAI has laid down some rules for health insurance claim settlement for all insurance providers registered under it. These rules are laid down to help both the insurer and the insured. Listed below are some of the rules for health insurance claims laid down by the IRDAI:
- A health insurance may not have an exit age if the policyholder renews it on schedule without any interruptions in renewal.
- A Group Health Insurance policy comes with a validity of a maximum of one year.
- The insurer is responsible for providing the policyholder with information regarding the terms and conditions of the policy concerning receiving care at a hospital in India.
- The insurance provider must give the policyholder the choice to switch to another plan after meeting the exit conditions for their health insurance policy. Additionally, insurers must award appropriate credits if the policy was renewed without any gaps.
- The insurance provider must give the applicant a fair, justifiable, and open explanation in writing if their request to purchase health insurance is declined.
- A policyholder will receive rewards if they renew their coverage on time, purchase it early in life, or have a positive claims experience with an insurance provider. The prospectus and policy document should include explicit references to the benefits as agreed by the board.
- Before issuing the policy, the insurance company should give the policyholder a list of medical facilities, government or otherwise, from whom the firm will accept the medical reports.
- Particularly for senior individuals, the premium amount should be reasonable, equitable, and clear. Additionally, the total sum should be made clear to the potential policyholder.
IRDAI new rules for claim settlement
IRDAI has rules for claim rejection and settlement as well. Some of them are:
For claim rejection
- If the policyholder maintains the coverage for 8 years without a break, the health insurance provider cannot deny a claim. These 8 years are called the moratorium period.
- Except in cases of fraud and/or a claim brought against the exclusion of the health policy after the moratorium period, the insurance company cannot appeal to the IRDAI against the settlement of such a claim.
- A claim cannot be denied by the insurance company due to misrepresentation or non-disclosure.
- A claim cannot be denied on that basis since IRDAI has allowed the insurance company an 8-year window for validating the information provided by the policyholder.
For claim settlement
- The insurance company is responsible for paying interest on the claim amount at a rate that is 2% higher than the bank rate if the insurer's claim payment is delayed.
- The claim should be resolved within 30 to 45 days of the date the policyholder received the last necessary document.