With skyrocketing medical expenses in India, having health insurance can prove a boon in case of any medical exigency. Events like unfortunate accidents or sudden illness can burn a massive hole in an individual’s pocket.
In such a scenario, one may think of using his life savings to receive proper medical treatment. Therefore, there is a growing need to remain financially independent as well as prepared for such events as early as possible. This is when purchasing health insurance in advance is beneficial.
The Insurance Regulatory and Development Authority of India (IRDAI) oversees the entire insurance industry in India. The growth and development of the health insurance sector are largely dependent on its rules and regulations, which are changed by IRDAI from time to time.
We’ll look at a few recent and beneficial changes to medical insurance in India in this article so you know what to expect.
Top 3 New Changes In Health Insurance
Three of the most important changes brought up by IRDAI are discussed below:
1. Introduction Of Innovative Products
Previously, the entire health insurance industry in India was offering dull, stagnant, and redundant products that not only lacked innovation but also failed to kindle interest among the masses. To break this aspect, IRDAI has led a new change by asking the insurance companies to come up with breakthrough insurance products or also known as “pilot products”. Such types of products can be tested for a year.
They should be created specifically for general insurance and not term or life insurance. After five years, insurance firms are allowed to discontinue or keep offering the program. Nonetheless, any policyholder who selects a pilot product should be transferred to one of the standard products if the pilot product is discontinued, keeping the policyholder’s best interests in mind. The goal of such a policy should be to cover risks that have not yet been covered by any other policies.
2. Special Emphasis On Cumulative Bonus Rather Than On NCB
By far, a No Claim Bonus (NCB) was provided to the policyholder for every claim-free year. This feature did not have any kind of impact on the sum insured of the policy. Now the insurance companies are laying a special focus on cumulative bonuses, in which a policyholder may receive a specified percentage addition to the total insured amount in the event of a year without any claims.
This will help in increasing the money available for improved medical care in the future. This percentage rises by at least 10% and at most 50%. The extra sum insured won’t increase proportionately to the medical insurance premium. The cumulative bonus given to the policyholder will not be reflected in the cost of the insurance. As a result, the price of an insurance policy will essentially stay the same while the amount insured will rise each year without a claim.
3. Focus On Being Healthy
Health insurance coverage is the most important tool for protecting the insured against the expensive costs of medical care. The insured must pay a set amount of premium to the insurer to receive the benefits of a health insurance policy.
By far, health insurance in India was primarily concerned with providing financial support to policyholders to assist them during their illnesses. However, those who maintained their health and fitness at all times did not receive many rewards.
The IRDAI’s new guidelines emphasize continuous rewards on renewal and early entry. Those who take preventive measures and take care of their health are incentivized by the organization, which helps in facilitating a healthy lifestyle amongst the policyholders. The terms and conditions of medical insurance in India or the policy document should make this very clear.
There are some exceptions too. If they have agreements with such vendors, health insurance companies are not permitted to provide discounts on any third-party services, such as fitness club memberships. However, if they are a part of the insurer’s network, discounts on diagnostic, pharmaceutical, or consultation services might be permitted.
The Bottom Line
Both IRDAI and insurance companies are leaving no stone unturned to improve the health insurance sector. The health insurance sector in India is going through a good transformation that will lead to better and more innovative products in the future.
Due to the above-mentioned modifications, people will feel considerably more at ease purchasing health insurance in the future. As a result, the penetration of health insurance in the nation will rise rapidly.
