Image Source : FREEPIK A representational picture of a doctor with a stethoscope.

The Insurance Regulatory Development Authority of India (IRDAI) has introduced new customer-friendly measures for health insurance policies. According to the latest circular, if insurers fail to settle claims within three hours during discharge, they must cover any additional costs incurred due to the extended hospital stay from the shareholders’ fund.

Key measures introduced by IRDAI

1. Claim settlement timelines: Insurers must decide on cashless authorisation requests within one hour, effective July 1, 2024. Final authorisation for discharge must be granted within three hours.


2. Policy cancellation: Cancellation charges for policies have been reduced. After 30 days of renewal, customers can cancel with a 7-day notice and receive a proportionate premium refund, unless a claim has been made.

3. Claim rejection rules: After 60 months of continuous coverage, claims can only be rejected if fraud is proven. A three-member committee must approve claim rejections.

4. Ombudsman compliance: Insurers must comply with the Insurance Ombudsman’s awards within 30 days. Failure to do so incurs a penalty of Rs 5,000 per day payable to the complainant.

Extended coverage and modern treatments

IRDAI has mandated that health insurance should be available in all types of hospitals, including affordable ones, with no denial of coverage in emergencies. Policies must cover modern treatments such as uterine artery embolisation, HIFU, deep brain stimulation, oral chemotherapy, robotic surgeries, and more.

Customer-friendly provisions

– Return policy: Customers can return a health policy within 30 days in the first year if unsatisfied.

– Multiple policies: Customers can decide the order of claims if they hold multiple policies.

– Coverage for all treatments: Insurers are encouraged to introduce products for OPD, chronic conditions, and modern treatments.

These changes, unless specified otherwise, are effective immediately from the issuance date of the circular on May 29, aiming to enhance customer experience and accountability in the health insurance sector.

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