Health Claims Must Settle Within 3 Hours, IRDAI Mandates

IRDAI introduced a master circular for health insurance products that has repealed 55 other circulars. With this master circular regulator, IRDAI is poised to improve transparency and the claims experience for policyholders. The master circular implements several regulatory changes regarding health coverage announced by IRDAI last month. These changes include removing the upper age limit, introducing new features like a customer information sheet for transparency, and allowing the distribution of claim amounts across multiple policies from different companies.

The new regulations will require insurers to approve cashless claims within one hour and provide final hospital discharge authorisation within 3 hours. Also, as per the master circular, the insures needs to provide policyholders with a broader range of options, including products/add-ons/riders, by offering a wide range of insurance products catering to people of diverse demographics, including occupational categories and medical conditions/ treatments along with all types of Hospitals and health care providers. 

With this, IRDAI aims to ensure suitability and affordability. Insurers are required to include a Customer Information Sheet (CIS) with each policy document, along with the flexibility to select products, add-ons, and riders based on their medical conditions and specific requirements.

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If a policyholder has multiple health insurance policies, they can choose the policy from which they want to receive the eligible claim amount. As per IRDAI, “The primary insurer with whom the claim is first submitted should coordinate and facilitate settlement of balance amount from the other insurers.”

If there are no claims during the policy period, insurers may reward policyholders by offering a No Claim Bonus, either by increasing the sum insured or discounting the premium amount. Policyholders are now entitled to receive a refund of the premium or a proportionate refund for the remaining policy period if they opt to cancel their policy at any point during the policy term.

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