IRDAI asks insurance firms to design coronavirus policies

The IRDAI proposal is probably a first in the world at a time when coronavirus cases have seen a spike in the country.

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The regulator has said when hospitalisation is covered in a product, insurers will have to ensure that the cases related to coronavirus disease are expeditiously handled. (Photo for representational purpose)

The Insurance Regulatory and Development Authority of India (IRDAI) has asked Indian insurers to design products covering the costs of treatment for coronavirus (Covid-19) in the country.

The IRDAI proposal is probably a first in the world at a time when coronavirus cases have seen a spike in the country. The regulator has said when hospitalisation is covered in a product, insurers will have to ensure that the cases related to coronavirus disease are expeditiously handled. “The costs of admissible medical expenses during the course of treatment including the treatment during quarantine period has to be settled in accordance to the applicable terms and conditions of policy contract and the extant regulatory framework,” it said.

“All the claims reported under Covid-19 have to be thoroughly reviewed by the claims review committee before repudiating the claims,” IRDAI said.

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Insurers said they are looking at the IRDAI proposal. “This would be covered in any case under most health insurance policies as it would not be pre-existing. And GIC covers all such products. Perhaps, it might now be included under critical illness policies as well,” said a GIC official. In order to provide need based health insurance coverage, insurers are introducing products for various specific diseases including vector borne diseases, IRDAI said, adding that this is being done for the purpose of meeting health insurance requirements of various sections. The regulator has also laid down norms to settle claims related to the treatment of coronavirus.

The regulator said these instructions will have to be implemented with immediate effect. Shreeraj Deshpande, chief operating officer, Future Generali India Insurance, said: “Any person who is hospitalised as a result of coronavirus and takes treatment will be covered as any other illness. The subsequent claims will be processed as per regular norms provided the individual has been hospitalised for 24 hours. The government has issued advisories on coronavirus infection and the insurance companies will be guided by that.”

The virus doesn’t have a vaccine yet, and it may take over a year to develop any vaccine for the disease, according to experts.

The regulator had recently set up a nine-member committee with former New India Assurance Chairman and MD G Srinivasan as Chairman and LIC Chairman MR Kumar as Co-chairman to study the feasibility of allowing life insurers to offer indemnity-based health policies. As of now, only general insurance firms and specialised health insurance companies are allowed to offer indemnity-based health policies. The IRDAI move follows intense lobbying by private life insurance companies for an entry into the fast-growing health insurance segment.