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.
Who is IRDAI and its role in health insurance?
The IRDAI is the topmost organisation in India responsible for the smooth operation of its vast insurance sector. Among its primary responsibilities are regulating the insurance companies (both government and private), protecting the rights and interests of the policyholders and creating conditions for fairness and transparency. In the field of medical insurance, IRDAI sets rules for the claim settlement process and makes sure that insurance providers properly handle the claims and provide the needed financial support to people.
IRDAI guidelines for claim settlement
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’s protection for policyholders
IRDAI has rules for claim rejection and settlement as well. Some of them are:
- 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.
- 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.
How to ensure a smooth claim process?
Policyholders can facilitate efficient claim settlements by:
- Understanding Policy Terms: Familiarise yourself with coverage details, exclusions and claim procedures.
- Maintaining Records: Keep all medical bills, reports and related documents organised for easy access during claims.
- Timely Intimation: Inform your insurer about hospitalisations or treatments promptly, adhering to specified timelines.
If you understand the details of your medical insurance plan, it can ease the claim process, particularly when you are managing medical insurance for parents.
FAQs
What is the time frame for claim settlement as per IRDAI?
Insurers are required to settle or reject a claim within 30 days of receiving all necessary documents as per the rules set by IRDAI.
Can insurers ask for additional documents after the initial submission?
Insurers needed to ask for all the required documents at once. In case any additional requests need to be made, they should be exceptional and justified.
What if my claim is rejected unfairly?
You can approach the insurer's grievance redressal cell. If unresolved, escalate to the Insurance Ombudsman or IRDAI.
Conclusion
IRDAI's regulations aim to create a transparent and efficient health insurance claim settlement process. In this blog, the guidelines set by IRDAI have been explained, which will help you understand and make better decisions regarding your medical insurance plan, which will go a long way in securing your overall health.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It is not intended as a substitute for professional advice, diagnosis or treatment. Please consult a certified medical and/or nutrition professional for any questions. Relying on any information provided in this blog is solely at your own risk, and ICICI Lombard is not responsible for any effects or consequences resulting from the use of the information shared.