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Tuesday, June 15, 2021

Complaints of insurers refusing to offer Covid policies: Irdai steps in

The regulator has been flooded with complaints about insurers refusing to offer or renew Covid policies fearing spurt in claims.

By: ENS Economic Bureau | New Delhi |
May 11, 2021 3:03:25 am
More-recent market dynamics also include heightened economic uncertainty and Covid-19 implications, which are expected to weigh further on non-life insurers.

With complaints of insurance companies refusing to offer and renew Covid insurance policies on the rise, the Insurance Regulatory and Development Authority of India (Irdai) on Monday directed insurers not to deny Covid policy coverage to customers in the wake of rising infection rates.

“It has come to the notice of the Authority that some insurers are not offering Corona Kavach and Corona Rakshak Policies to customers, and some insurers are not renewing such policies,” Irdai said. The regulator has been flooded with complaints about insurers refusing to offer or renew Covid policies fearing spurt in claims.

“In the wake of rising infection rates due to the second wave of the Covid-19, the insurable public require appropriate health insurance coverage and it is not correct to deny such coverage to the customers in this crucial time,” Irdai said in a letter to insurance companies. All insurers are advised to ensure that wherever Corona specific standard products have been filed and approved by the Authority, the same should be offered to the customers according to the insurer’s underwriting policy, it said.

“Similarly, where the underlying corona specific product enables the insured to renew the policy as specified in the Irdai circular, insurers are advised to renew such policies subject to the underwriting policy of respective insurers,” it said. As the pandemic has accentuated the need for health insurance, all insurers are advised to actively promote protection through health insurance so as to develop the much-needed trust and goodwill of the general public, Irdai said.

“Insurers have seen a spurt in claims under the Covid policies. They don’t want to take a hit in their books,” said an insurance source. Two corona-specific products — Corona Kavach and Corona Rakshak — were launched by insurers under the guidance of Irdai.

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