The COVID-19 pandemic has taught everyone to adapt in testing times. The whole world has been forced to change their lifestyles and exercise social distancing to survive the pandemic. But it is not just the people who have altered the way they led their lives. The health insurance industry has also gone through some major changes to tackle the challenges thrown by the pandemic. The idea is to continue providing health insurance services to the public at large without compromising on their safety from the coronavirus disease. Having said that, this article throws light on six prominent changes that have directly impacted the health insurance industry due to the COVID-19 pandemic.
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The COVID-19 pandemic paved way for specific coronavirus health insurance plans. In India, two such plans were launched by health insurers on the direction of the IRDA i.e. Corona Rakshak and Corona Kavach policy. These plans provide coverage for all medical expenses incurred due to contracting COVID-19. Unlike regular health insurance plans, both Corona Rakshak and Corona Kavach policy covers the cost of consumables, such as PPE kits, masks, gloves, etc used during the treatment of coronavirus. In fact, the Corona Kavach policy also covers the cost of medical expenses arising out of comorbidities.
The coronavirus health insurance plans are short-term and are available for a period of 3.5/ 6.5/ 9.5 months. Recently, the Insurance Regulator has allowed insurers to renew these policies for up to 31st March 2021. Besides, it also allows the policyholder to migrate their Corona Kavach policy to any other indemnity-based health plans.
In a welcoming change, health insurance plans have now started covering the medical costs incurred on telemedicine. For the unversed, telemedicine refers to medical consultations taken over telephone, chat messages, video calls, etc. where the patient does not have to physically meet the doctor. Normally, health plans do not cover the cost of telemedicine consultations. However, the COVID-19 pandemic led to the lockdown and social distancing forcing people to seek offsite medical consultations instead of visiting the doctor. As more and more people were opting for telemedicine, the IRDA instructed health insurers to be inclusive of the cost of telemedicine under plans that offer coverage for doctor consultations.
The COVID-19 pandemic has also led to the introduction of the instalment option for paying health insurance premiums. The pandemic has adversely affected economies around the world, including India. A major population of the country has experienced a financial setback with many of them losing their source of income. Realising the financial crunch which the people are facing, the IRDA introduced instalment mode for paying the health insurance premium. This move not only makes health plans more affordable at a time when it is of utmost need but also enables people to opt for a higher sum insured that covers their health insurance needs optimally.
As lockdown and social distancing prevented people from stepping out of their homes for non-essential work, they were only left with the option of buying health insurance online. Therefore, the Insurance Regulator directed health insurers to streamline the online sale of insurance products to ensure ease of buying. As a result, people can now easily renew their existing health policy or buy a coronavirus health insurance policy online. In fact, insurers now do KYC verification online through video calls and ask applicants to upload the documents required for KYC.
With online buying of health plans becoming popular due to the COVID-19 pandemic, people are no longer required to put their physical signatures on a proposal form at the time of buying a policy. The Insurance Regulatory & Development Authority (IRDA) of India has allowed health insurance companies to do away with physical signatures on proposal forms. Instead, the verification of the applicant can be done through a one-time password (OTP) or confirmation email sent to them. However, physical signatures can be skipped only while issuing health insurance plans to individuals with a sum insured of up to Rs 5 crore. Moreover, this exemption is only applicable until 31st march 2021.
In the recent health insurance guidelines issued by the IRDA, the insurance companies are required to provide a decision on a claim request within 30 days. This one is not exactly a direct impact of the pandemic but is a major change that happened during this time. All health insurance providers will be required to approve or reject a claim within a period of 30 days of receiving the claim request. If they fail to do so, they will be required to pay a 2 per cent interest above the applicable bank rate on the claim amount. This guideline came into effect from 1st October 2020.
In a Nutshell
The COVID-19 pandemic has created havoc in everyone’s life. But it has also led to some major changes in the health insurance industry, which have worked in the favour of the general public. For starters, the coronavirus health insurance plans have made it possible for people to afford the medical expenses arising out of COVID-19 disease. Moreover, anyone can buy Corona Rakshak policy, Corona Kavach policy or other health plans online without physical signatures and can pay the premiums via instalments. Hopefully, these changes will increase the penetration of health insurance in India.
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