IRDA to Launch New Set of Regulations For Health Insurance Products

Insurance Regulatory and Development Authority of India is planning to implement more strict regulations to check the number of rising fraud cases by standardizing health insurance products. According to the regulator, health insurance sector is blooming at a fast rate and so are fraud activities.

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    “We at IRDAI do believe that health insurance is picking up very fast, but so is the fraud,” the newly joined member (finance), IRDAI, Vijayalaxmi Iyer, told PTI.

    “We are coordinating with all the research bodies like laboratories, diagnostic centres and hospitals to establish standard norms for various services which are part of the health insurance segment,” she said.

    All related stakeholders are the part of the discussion and it has been put on the IRDAI website, she further added.

    “After completing the procedures, we will send them for the approval of the IRDAI board,” Iyer, who recently superannuated from Bank of India as chairperson, said.

    New regulations

    She said that for health insurance sector, IRDAI is expected to come up with a new set of regulations within the next few months.  

     “The idea is to bring about an orderly and sustainable growth in the industry.”

    In fiscal 2015, the health insurance industry has accumulated Rs. 20, 442 crore in premium business.  In the approaching regulations, the central theme of IRDAI will revolve around features of the product, disclosures in sales literature, better transparency, and disclosure of web portals to propagate suitable information for decision-making.

    Health Insurance Rules

    In its major changes in health insurance sector, IRDAI is planning to include incentives for healthy policyholders and a level-playing field for life and non-life insurers.

    These new draft rules in health insurance could require higher solvency requirements for the group health segment. Presently, the solvency ratio, which is required to be maintained by insurers at all times, is 150%.

    After the implementation of these new rules, healthy policyholders will get incentives like more attractive premium rates.  

    At present, there is no such linkage of pricing to the fitness levels of the policyholder. But, insurance companies already offer health and wellness-based incentives to individuals, including gym membership discounts, spa coupons etc., to hearten healthy behavior.

    In addition, according to the new proposed regulation, IRDAI has mandated health insurance claims processing agencies to reflect the negotiated discounts on the bills so that the policyholders are aware of the actual rates.

    Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

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