The Insurance Regulatory and Development Authority of India (IRDAI) has notified a few changes in health policy regulations which have come into effect from the new financial year 2024-25. Some of them are an improvisation over the regulations implemented in 2020.
These change in rules will be included not just in new health policies issued but also in the existing ones at renewal. Here are the key provisions:
1. Modification in the definition of pre-existing disease: A pre-existing disease is a medical condition that has started even before a person has taken health insurance. The definition of pre-existing disease was standardised by IRDAI in 2020 as it was a grey area. Earlier pre-existing disease meant any ailment diagnosed by a doctor or treatment proposed/received from the doctor, not more than 48 months prior to the date of commencement of the policy issued by the insurer. This 48 months has now been reduced to 36 months in the definition of pre-existing disease.
So, if you are planning to buy a new policy and you have a medical condition which is diagnosed or you are receiving treatment in the last 3 years, it will be considered a pre-existing illness and accordingly waiting period will apply on the same before you can claim hospitalisation cost from the insurer.
2. Reduction in waiting period: Waiting period is the time span after the purchase of policy during which an insured cannot claim any hospitalisation expense from the insurer. Pre-existing diseases & specified ailments as defined in the policy usually have a waiting period extending upto a maximum of 4 years. This has now been reduced to a maximum of 3 years. This implies that any insurer can have a waiting period clause on pre-existing diseases & specified ailments but not more than 3 years.
Suppose, you are suffering from any cardiac condition, your insurer will pay hospitalisation claims related to the condition after you have paid maximum 3 annual premiums.
3. Reduction in moratorium period: Insurers often reject claims citing concealment of pre-existing illnesses during policy purchase. Such non-disclosure is seen as a misrepresentation of facts. Consequently, claims get rejected, even if they pertain to unrelated diseases.
Moratorium period is the duration after which insurance companies are barred from raising queries around disclosures on pre-existing illnesses that the policyholder may have had at the time of buying the policy. Earlier, the moratorium period was triggered after 8 continuous years of policy being in force. This was too long a period and it has been reduced to 5 years. Now after 5 years, health insurers cannot reject claims citing non-disclosure of pre-existing conditions, except for proven fraud and permanent exclusions.
However, although fraud is very different from non-disclosure in health insurance, some companies can interpret serious non-disclosure of critical ailments as fraud and reject claims.
4. Special provision for senior citizens: The regulator has notified all insurers to establish a separate channel to address the health insurance related claims and grievances of senior citizens. The details of such channel shall be available in the website of the insurers.