It will now be easy for customers to choose a health insurance policy because soon insurers will have to offer standard communication, policy tenures, exclusions and few other things. IRDA is coming out with some good recommendations that will be very useful to the customers while choosing a health insurance policy.
Earlier this year, the insurance regulator set up a Health Insurance Forum which will assist IRDA in creating standard rules and processes in the health insurance industry. On Thursday, the IRDA conducted its first meeting with the Forum where the IRDA Chairman shared some of the proposed changes in health plans. Mr. J Hari Narayan said that a working group which constitutes members from the industry has standardised 20 common terms associated with health insurance, 20 critical illnesses, standard exclusions, pre authorisation and claims forms, discharge summary and bill processes.
The regulator expressed its concern on the communication which goes out to the customers while purchasing a health insurance policy. Many complicated words and jargons which are used in the policy brochures or on websites need to simplified so that a customer can easily understand the benefits of the plan. At the time of paying the renewal premiums or making a claim many policyholders realise that the policy features are not in sync with their requirement. This is the probably the reason why IRDA registered around 35,000 complaints related to health insurance out of the total 92,898 complaints in the non-life insurance sector.
The Chairman also shared his concern on the bleeding health insurance portfolio due discounted pricing of the product. Looking at the high claim rates, the health insurers should be increasing the premiums but they are not doing so. Non-life insurance companies are still offering low and competitive pricing for their health insurance products in pursuit to grab maximum market share.
However, with recommendations such as standard choices of policy tenure, exclusions and critical illnesses, it looks like the customers stand to benefit a lot more than what they are currently availing.