Health insurance claims
Based on a Public Interest Litigation (PIL 12 of 2011) filed by Gaurang Damani (author of this website), IRDA came out with Health Insurance Regulations, 2013 for the entire medical insurance (mediclaim) industry in October 2013. These regulations should benefit the over 7 crore citizens, who own a medical insurance policy in India.
Main features of the Health Insurance Regulations (HIR)
Related to policy document:
- Uncomplicated one-page information must be part of the policy document as per sec 8(b) of HIR, 2013
- Premium cannot be increased at renewals in an arbitrary way, especially after a claim is made as per Sec 7(h)(i) and (ii) of HIR 2013. Also 7(c) & 4(b)
- There will be no change in premiums in multi-year policies as per Sec 3(b) and 3(c) of HIR 2013
- ID card to have logo of Insurance company (not of TPA) and the card should be auto-renewable as per Sec 9(e) and (f) of HIR 2013
- Policy is portable from one Insurer to another, 45 days prior to maturity of policy (including cumulative bonus would also be portable) as per Schedule I(1) & (18) of HIR 2013
- Free-look period is 15 days as per Sec 5(g)(i)1 of HIR 2013
- Cumulative bonus amount also to be mentioned as per sec 5(i)1 of HIR, 2013
- All disclosures as per the new regulations have to be included in the policy document as per sec 8(e)(i) of HIR, 2013
Related to Claims:
- TPA is not permitted to settle claims as per Sec 12(b)(i) of HIR 2013
- The claims settlement letter should mention the specific medical grounds for denial/ rejection of claim as per Sec 12(d)(ii) of HIR 2013
- TPA has to electronically transfer the claims document to Insurer for a decision as per Sec 12(d)(i) of HIR 2013
- Consumer will get interest of 2% over the prevailing bank rates, on claims payment delayed beyond 30 days as per Sec 8(e)(iv) of HIR 2013
- The claims payment will be made from the Insurer’s bank account and not the TPA’s as per Sec 11(a) of HIR 2013. Earlier claim cheques were issued to the customer by the TPA (Third party Administrator), but now the insurance company would have to write a claim cheque or ECS directly to the customer. This would eliminate the float that some of the TPAs were enjoying. Also, there was never any public audit of the claims funds sanctioned by the Insurance company v/s actual amount disbursed by the TPA.
- The TPA will ask for claims related papers in one time only, and not in a piece meal manner as per Sec 8(d)(ii) of HIR 2013
- Non-allopathic (AYUSH) treatments may be covered as per Sec 5(l) of HIR 2013
- Fees to the TPA shall not be related to reduction of claims costs as per Sec 13(b) of HIR 2013
- Change of TPA will be intimated to the consumer in writing 30 days before hand as per Sec 14(a) of HIR 2013
For Senior citizens:
- Entry age is up to 65 years and there will not be any exit date for a policy as per Sec 5(e) of HIR 2013
- Premiums shall be fair, justified, transparent and duly disclosed upfront as per Sec 5(q)(i) of HIR 2013
- Separate claims & grievance cell as per Sec 5(q)(ii) of HIR 2013
- Withdrawal of a product needs prior IRDA approval as per Sec 4(d)(i) of HIR 2013
- Cannot force consumer to shift to other product as per Sec 5(b) of HIR 2013
- All policies will be ordinarily renewable as per Sec 5(f)(i), (ii) and (iii) of HIR 2013
- Pre-insurance check-up cost included in premium as per Sec 5(h)(i) of HIR 2013
Disputes resolution, especially Claims processingFor claims-related complaints, consumers can write to the Grievance cell of the Insurance company. As per IRDA guidelines, grievances must be acknowledged by the Insurance company in 3 working days and it must be resolved in 15 working days.
If there is no response, the IRDA Call Centre (toll-free at 155255) offers a true alternative channel for policyholders, serving from 8 AM to 8 PM, Monday to Saturday in Hindi, English and various Indian languages.
You can also write to email@example.com or online or through post at:
Consumer Affairs Department
Insurance Regulatory and Development Authority (IRDA)
3rd floor, Parishram Bhavan,
Basheer Bagh, Hyderabad
For still unresolved disputes of less than Rs 20 lakhs pertaining to claims settlement or regarding premiums paid/ payable and non-issue of insurance documents, the Insurance Ombudsman can be approached. The written complaint with the relevant claim papers can be send by the customer himself (no lawyer is required), within 1 year of dispute. After registering with the Ombudsman office, attach this application document.
Important precautions to be taken in case of claims:
- Best option for the consumer is to obtain Cashless facility i.e. the Insurance company pays the bills directly to the hospital. But the hospital must be part of their preferred network (PPN), which list should be available on the insurance company website.
- If you wish to take treatment in a hospital, which is not on the PPN cashless list, then make sure you intimate the Insurance company/ TPA within 24 hours of admission in any hospital.
- In case of a pre-planned surgery, it is better to inform the Insurance company/ TPA much earlier.
Other general guidelines:
- Generally Family floater policy is cheaper than buying individual policies for family members.
- Generally bed charges are 1-2% of the sum assured, depending on your Insurance carrier. All other charges like doctor visit etc. are often related to this bed charge, so it is important to be within these limits.
- Co-Pay means that a certain percentage or a certain fixed amount of the claim has to be borne by the policyholder. If co-pay is 15%, then whatever is the hospital bill you will have to pay the 15% and balance 85% only will be paid by the Insurance company.
- Generally exclusions and pre-existing diseases are not covered by a medical insurance policy (as specified in their policy document). Generally these could be covered after 2 years of holding the policy. Consumer must be honest in disclosing pre-existing ailments, if any.
- Policy can be renewed within 15 days grace period after expiry of the policy. However coverage is not available for the days for which the premium was not received by the Insurance company.
- One can transfer the policy from one Insurance company to another and the credits (including cumulative bonus) would also be portable.
- New policy should be issued within 15 days of submission of proposal
- To keep a check that people dont try to take a policy where they have been diagnosed with some illness and they require immediate hospitalization, a 30 day waiting period is kept, where Insurance Company will not pay any kind of claim within the first 30 days of taking the new policy, (exception is that if policyholder meets an accident then the claim is payable).
- Under Section 80D, annual deductions upto Rs 25,000 can be availed of (Rs 30,000 for senior citizens)