A set of guidelines likely to make it easier for health insurers to tweak certain features of the cover provided to individuals, including one permitting collection of premium in instalments and another increasing the maximum entry age, has been notified by IRDAI.
It is “proposed to permit the insurers to effect minor modifications, on certification basis subject to complying [with] these guidelines,” said a communication from the Insurance Regulatory and Development Authority of India (IRDAI) to general and standalone health insurance companies.
Options for premium
Stating the guidelines are applicable to approved individual products of health insurance business, the regulator listed among the minor modifications that will be permitted addition of premium payment options.
In other words, in addition to existing, yearly payment mode, the insurers can collect premium in other frequencies (monthly, quarterly or half-yearly) or in installments. The insurers can also make change in the base premium rates, subject to the change not exceeding plus or minus 15% of the premium rates of originally approved individual product, according to the circular issued by Member-Non-Life T.L. Alamelu.
Another change insurers are allowed to make to their products is reducing the minimum and increasing the maximum entry age. Describing the changes as welcome, Rashmi Nandargi, head-retail health, PA and travel underwriting, Bajaj Allianz General Insurance, said typically the maximum age limit of the health insurance policies filed is up to 65 years. But if the insurer feels the age limit can be extended, then it can be increased beyond 65.
Other minor modifications the health insurers can make are addition of distribution channels, addition of approved standalone riders or add-ons to the products; minor changes in policy wordings; expansion of the list of day care procedures to be offered and addition of critical illnesses covered under benefit-based products.
In allowing the minor modifications, the IRDAI said the proposed modifications, however, should not impact the benefit structure of the product, including the manner of settlement of the underlying benefits. Insurers, the circular said, should not impose afresh any deductible, co-pay or sub-limits. Also, there shall be no change in the wordings of exclusions or time-bound waiting periods of the approved individual product.
Dr. Nandargi said the guidelines would help making the distribution of insurance products better and also increase transparency in the product offering. These guidelines framework have also made the implementing process faster for the insurer compared to the earlier longer filing process.
The guidelines come into force with immediate effect, according to IRDAI.
