Health Insurance is a contract between two parties- policy holder and Insurer, where insurer provides financial protection to the policyholder by reimbursing medical expenses incurred by policyholder as per the terms and conditions of the contract.

As per Section 2 (6C) of Insurance Act, 1938 defines Health Insurance Business as under:

"health insurance business" means the effecting of contracts which provide for sickness benefits or medical, surgical or hospital expense benefits, whether in-patient or out-patient, travel cover and personal accident cover "

There are two types of Health Insurance policies:

1. Indemnity based health insurance policy pays actual medical expenses incurred by the insured, up to the sum insured as per the terms and conditions of the policy.
2. Benefit based health insurance policy pays a fixed lump sum amount, i.e. the sum insured, regardless of actual medical expenses as per the terms and conditions of the policy.

Health Insurance policies are offered by all Life, General and Health Insurers that are registered with IRDAI. The names of these companies are available on the  IRDAI website www.irdai.gov.in. It may be noted that General insurers and Health insurers may offer individual and group health insurance products on indemnity and/or benefit basis whereas, Life insurers can offer individual and group health insurance products only on benefit basis.

You may approach any of the IRDAI registered insurers offering health insurance. The names of these companies are available on the IRDAI website www.irdai.gov.in. You may check the products offered by an Insurer on their website. You may also approach any Insurance Intermediary registered with IRDAI or any authorised Insurance Agent.

While buying health insurance policy, please pay attention to the following:

• You need to disclose details of all pre-existing health problems. Concealing facts can lead to disputes when making a claim and the Insurer may reject the claim and even cancel the policy.
• The company may require medical test reports based on your age at entry; ensure to follow all procedures and documentation requirements.
• Understand who is responsible for the cost of the medical tests.
• Pay the premium only after the Insurer has accepted your proposal.

• Check the following details regarding the product:

1. Read and understand terms and conditions carefully.
2. Insurance products may have some restrictions in the coverage, pay special attention to the following terms and conditions in the policy:
   • Limits on Room Rent and ICU Charges
   • Waiting periods for Pre-Existing Diseases
   • Waiting period before certain diseases can be covered
   • Exclusions (conditions not covered) under the policy
   • Restrictions or sub-limits on various expenses relating to hospitalization
   • Co-payment, which means you have to share a part of the claim
   • Check the list of Eligible Hospitals/Healthcare providers for medical treatments & Cashless Payments.
3. Ensure you have been provided the customer information sheet (CIS) and explained in detailed by the sales person.

• Renew the policy on time. Delay in policy renewal may result in non-coverage of insured event and/or loss of continuity benefits.

Customer Information Sheet (CIS) is a document provided by the Insurer along with every policy document that explains in simple words, basic features of a policy at one place.

The CIS shall be provided to every policyholder in case of both Individual Insurance policy holder as well as a Member of Group Insurance Policy. Acknowledgment in physical or digital will have to be obtained from the Policyholder.

CIS shall at the minimum contain details like

1. type of insurance
2. sum Insured
3. coverage provided
4. summary of exclusions which policy does not cover
5. sub-limits (a pre-defined limit above which insurer will not pay
6. deductibles (specified amount up to which an insurer will not pay any claim/which will be deducted from total claim, if the claim amount is more than the specified amount)
7. waiting period(s) (time period during which specified diseases/ treatments are not covered)
8. certain important things such as Free Look Period, Policy Renewal, Migration, Portability and Moratorium Period.

It contains information regarding the Claims Procedure, Policy Servicing and Grievance Redressal Mechanism including contact details of Insurance Ombudsman of appropriate jurisdiction.

The policyholder shall give nomination for the purpose of payment of claims. In the event of death of the policyholder, the claim proceeds will be paid to the nominee. Nomination can be changed any time during the term of the policy by the policyholder.

In a family floater policy, all family members under the policy have a single sum insured limit which may be utilised by any or all members.

Waiting period is normally the time period specified in the policy during which specific conditions, treatments, services, or situations are not covered. Maximum waiting period under health insurance policy shall not be more than 36 months.  (e.g. Waiting period for Pre-existing diseases)

Specific waiting period normally means a period up to 36 months from the commencement of a health insurance policy during which period specified diseases/treatments contracted during the policy period (except due to an accident) are not covered. On completion of the period, diseases/treatments shall be covered provided the policy has been continuously renewed without any break (e.g. Cataract, Hernia etc.).

1. Pre-existing disease (PED) normally means any condition, ailment, injury or disease that is/are diagnosed by a physician not more than 36 months prior to the date of commencement of the policy issued by the insurer; or for which medical advice or treatment was recommended by, or received from, a physician, not more than 36 months prior to the date of commencement of the policy.
2. In respect of Overseas Travel Policies, coverage for pre-existing diseases depends upon the terms and Conditions of the Policy.
3. Life insurers may define norms for applicability of PED at reinstatement.

An exclusion refers to specific conditions, treatments, services, or situations that are not covered under a health insurance policy (e.g. Cosmetic surgery, Self-inflicted injuries etc.) as per the terms of the policy.

Co-payment is a specified amount / percentage of the admissible claim amount to be paid by policyholder / insured.

Deductible is a specified amount stated in the policy up to which an insurer will not pay any claim, and which will be deducted from total claim amount (if claim amount is more than the specified amount).

Normally sub-limit is a pre-defined limit for specific conditions, treatments, services, or situations. The insurer will not pay any amount in excess of this limit.

As per the Clause 1(a) of Chapter 1 of the Master Circular on IRDAI (Insurance Products) Regulations 2024- Health Insurance dated 29/05/2024, insurers are required to make available products/add-ons/riders to provide wider choice to the policyholders/prospects catering to

1. all ages;
2. all types of existing medical conditions;
3. pre-existing diseases and chronic conditions;
4. all systems of medicine and treatments including Allopathy, AYUSH and other systems of medicine;
5. every situation of treatment including domiciliary hospitalization, outpatient treatment (OPD), Day Care and Homecare treatment;
6. all regions, all occupational categories, persons with disabilities and any other categories
7. all types of Hospitals and Health Care Providers to suit the affordability of the policyholders/prospects. Policyholder shall not be denied coverage in case of emergency situations.

The above does not imply that the Insurer shall have one product to cater to all of the above.

Also, Insurers are required to offer products in compliance with relevant provisions of various laws such as:

1. The Mental Healthcare Act, 2017;
2. The Rights of Persons with Disabilities Act, 2016;
3. The Surrogacy (Regulation) Act, 2021;
4. The Transgender Persons (Protection of Rights) Act, 2019, and
5. The HIV and AIDS (Prevention and Control) Act, 2017

Policyholder needs to check with the Insurer to see availability of health insurance products that caters to their needs. Policyholder may be required to buy add-ons/ riders to access wider coverage.

Insurers determine the pricing of the product based on Actuarial principles. Various factors are taken into consideration by Insurers for determining pricing of health insurance such as

• Mortality and Morbidity statistics- Age, gender, habits, occupation, family history, past illness or surgery, current health status etc.
• Past Claims experience
• Expenses like administrative costs, distribution cost, salaries etc.
• Other factors – Medical inflation, overall inflation etc.

Insurers shall allow for customization of products by customer by providing the flexibility to choose products/add-ons/riders as per his/her medical conditions/specific needs.

All general and health Insurers shall offer a specific cover for Persons with Disabilities (PWD), persons affected with HIV/AIDS, and those with mental illness.

A model product setting out the minimum scope and parameters for design of the product has also been given by IRDAI as per Cir. No. IRDAI/HLT/CIR/MISC/58/2/2023 dated 27.02.2023. https://irdai.gov.in/document-detail?documentId=2865446

Apart from above, insurers may offer other health insurance products to persons with Disabilities (PWD), HIV/AIDS, and mental illness as per the underwriting policy.

A period of 30 days (from the date of receipt of the policy document), if no claims are made during this period, is available to the policyholder to review the terms and conditions of the policy. This period is known as Free Look period.

If not satisfied with any of the terms and conditions, you have the option to cancel the policy. This option is available in case of policies with a term of one year or more.

When you return your health insurance policy during free look period, if no claims are made during this period, you shall be entitled to a refund of the premium paid subject to a deduction of a proportionate risk premium for the period of cover and the expenses, if any, incurred by the insurer on medical examination of the proposer, duty charges & taxes.

A request received by insurer for cancellation of the policy during free look period shall be processed and premium shall be refunded within 7 days of receipt of such request.

The policyholder may cancel his/her indemnity based policy at any time during the term by giving 7 days’ notice in writing.

The Insurer shall

1. refund proportionate premium for unexpired policy period, if the term of policy up to one year and there is no claim (s) made during the policy period.
2. refund premium for the unexpired policy period, in respect of policies with term more than 1 year and risk coverage for such policy years has not commenced.

Cashless facility normally means a facility extended by the Insurer or TPA on behalf of the Insurer to the insured, where the payments for the medical treatment undergone by the Insured in accordance with the policy terms and conditions, are directly made to the empanelled hospitals/healthcare provider by the Insurer to the extent cashless approval is given.

TAT for settlement of claims is as under:

1. Cashless

1. TAT for preauthorization of cashless facility: Insurer shall decide on the request for cashless authorization immediately but not more than one hour of receipt of request.
2. TAT for cashless final bill authorization: Insurer shall grant final authorization within three hours of the receipt of discharge authorization request from the hospital.

2. Other than Cashless- 15 Days

1. Indemnity Policies: A policyholder can file for claim settlement as per his/her choice under any policy. The Insurer of that chosen policy shall be treated as the primary Insurer. In case the available coverage under the said policy is less than the admissible claim amount, the primary Insurer shall seek the details of other available policies of the policyholder and shall coordinate with other Insurers to ensure settlement of the balance amount as per the policy conditions, without causing any hassle to the policyholder.

2. Benefit based Policies: On occurrence of the insured event, the policyholders can claim from all Insurers under all policies.

“Grace period” is the specified period of time, immediately following the premium due date during which premium payment can be made to renew or continue a policy in force without loss of continuity benefits pertaining to waiting periods and coverage of pre-existing diseases. Coverage need not be available during the period for which no premium is received.

The grace period for payment of the premium for all types of insurance policies is:

1. fifteen days (where premium is paid on a monthly instalments) and
2. thirty days (where premium is paid in quarterly/half yearly/annual instalments.

If the policy is renewed during grace period, all the credits accrued under the policy shall be protected. The same is applicable for both Indemnity and Benefit products.

1. When the premium is paid in instalments during the policy period, coverage will be available for the grace period also.
2. In cases wherein the premium is not paid in instalments, coverage during the grace period will depend on the terms and conditions of your policy.

An Insurer shall not resort to fresh underwriting unless there is an increase in sum insured. In case, increase in sum insured is requested by the policyholder, the Insurer may underwrite only to the extent of increased sum insured.

The Insurer may reward the policyholders who do not make claim in the form of No Claim Bonus (NCB). Such NCB shall be paid as per the choice/ express consent of the policyholder in the following forms at the time of every renewal:

1. Cumulative Bonus: Addition in the Sum Insured without an associated increase in premium and/or
2. Discount in renewal Premium

For individual products, the loadings on renewal premium shall not be based upon any individual policy claim experience.

Insurer shall not deny the renewal of a health insurance policy on the ground that the insured had made a claim or claims in the preceding policy years, except for benefit based policies where the policy terms states that policy contract shall terminate following payment of the benefit covered under the policy like critical illness policy.

“Break in policy” normally means the period of gap that occurs at the end of the existing policy term/instalment premium due date, when the premium due for renewal on a given policy or instalment premium due is not paid on or before the premium renewal date or grace period. Accrued benefits may be lost completely.

The decision to withdraw any Health Insurance product /add-on/rider shall be taken by the PMC (Product Management Committee) of the insurer. Once an Individual Health Insurance product, add-on, or rider is withdrawn, it cannot be offered to new customers after the withdrawal date. Following options are available to existing customers of a withdrawn health insurance product:

1. A one-time option to renew the existing product, if renewal falls within the 90 days from the date of withdrawal of the product; or

2. Migrate to any other suitable product (any other existing product or modified version of the withdrawn product) as per the choice of the policyholder.

Any Individual or Group Health Insurance Product offered with a term exceeding one year, shall be continued on the agreed terms for all the existing policyholders for the entire policy term.

“Migration” means a facility provided to policyholders (including all members under family cover and group insurance policies), to transfer the credits gained from previous health insurance policy to another with the same insurer.

“Portability” means a facility provided to the health insurance policyholders (including all members under family cover), to transfer the credits gained for, pre-existing diseases and specific waiting periods from one insurer to another insurer.

Portability is allowed for individual, family floater and group health insurance policies at the time of renewal.

1. A policyholder desirous of porting his/her policy to another insurer shall apply to such insurer to port the entire policy along with all the members of the family, if any, at least 30 days before, but not earlier than 60 days from the due date for renewal.

Provided that Insurers are free to consider proposal for portability even if the policyholder has approached within 15 days from the renewal date of the existing policy, but in all such cases acquiring insurer shall ensure that there is no break in policy.

2. The acquiring insurer shall furnish to the policyholder, the Portability Form authorizing it to obtain policy and claim related information from the existing insurer. The policyholder shall fill in the portability form along with proposal form and submit the same to the acquiring insurer.

3. On receipt of the Portability Form, the acquiring insurer shall seek the necessary details of policy and previous claim information, if any, from the existing insurer through the portal maintained by Insurance Information Bureau of India (IIB) https://iib.gov.in/ portal.

4. The existing insurer, shall furnish the requisite data for porting insurance policies within 72 hours of the receipt of the request.

5. The Acquiring insurer shall decide and communicate on the proposal immediately but not more than 5 days of receipt of information from Existing insurer.

6. The policy shall contain the details of the continuous coverage since the inception of first policy.

The policyholder is entitled to transfer the credits gained to the extent of the Sum Insured, No Claim Bonus, specific waiting periods, waiting period for pre-existing disease, Moratorium period etc. from the Existing Insurer to the Acquiring Insurer in the previous policy.

After completion of sixty continuous months of coverage (including portability and migration) in health insurance policy, no policy and claim shall be contestable by the insurer on grounds of non-disclosure, misrepresentation, except on grounds of established fraud. This period of sixty continuous months is called as moratorium period.

The moratorium would be applicable for the sums insured of the first policy. Wherever, the sum insured is enhanced, completion of sixty continuous months would be applicable from the date of enhancement of sums insured only on the enhanced limits.

Following are the timelines/ TAT for some common features/Services in health insurance policies:

Third Party Administrator (TPA) means a company registered with the Authority, and engaged by an insurer, for a fee for providing health services such as cashless and claims administration, customer service to the policyholders. TPA act as intermediary between the insured and the insurer

Insurer, on the other hand, is a business entity that provides insurance policies to individuals or organizations. These companies pool risks from their policyholders and provide financial protection or reimbursement against losses from specific events, such as accidents, health issues, or property damage.

So, while a TPA and an Insurer both operate within the insurance industry, they are not the same. A TPA handles administrative functions on behalf of an insurer, whereas an Insurer underwrites and sells insurance policies.

1. Insurers shall have Board approved criteria

1. for monitoring the

1. performance of TPAs,
2. servicing of the customers,
3. TATs and service level parameters.

In no case, the remuneration of TPAs shall depend upon the Incurred Claim Ratio (ICR) of the policies served by the TPAs;

b. for obtaining feedback from the customers on the settlement of claims;

c. for claw back of remuneration/charges paid to TPA based on the customer feedback. The clawed back amounts shall be passed to the customer.

2. Insurers shall ensure that the payments are made to the TPAs only after availing the services and upon full discharge of services by the TPA satisfactorily.

You may visit the insurer’s website to access all the details related to your Policy and other details. Details of registered insurers is available on the IRDAI website (www.irdai.gov.in).

You should be able to access the following information in the insurer’s website amongst other things:

1. Product Information:
   1. A list of products currently on offer.
   2. A list of products that have been withdrawn.
2. List of Hospitals/Healthcare Providers:
   1. 1. A list of hospitals and healthcare service providers with whom they have tie-ups for cashless claim settlement.
      2. A list of hospitals and healthcare service providers that are part of the common network of hospitals.
3. Claim Settlement Procedures:
   1. 1. Detailed procedures for policyholders to follow for claim settlement under the cashless facility.
      2. Steps for reimbursement of claims. A clear indication that if policyholders use services from hospitals or healthcare providers not listed above, they will need to file a reimbursement claim with the insurer
4. Turnaround Times (TATs):
   1. 1. The turnaround time for policy servicing, approvals of cashless claims, and reimbursement claim settlement.

Insurer is required to comply with the award of the Insurance Ombudsman within 30 days of receipt of award by the Insurer. In case the Insurer does not honour the ombudsman award, a penalty of ₹ 5000/- per day shall be payable to the complainant. Such penalty is in addition to the penal interest liable to be paid by the Insurer under The Insurance Ombudsman Rules, 2017.

Insurers are required to establish a separate channel specifically for addressing health insurance-related claims and grievances of senior citizens. The details of this channel are available on the insurers’ websites.

“Ayushman Bharat Health Account” (ABHA) number is a hassle-free method of accessing and sharing health records digitally. It enables interaction with participating healthcare providers, and allows to receive digital lab reports, prescriptions and diagnosis seamlessly from verified healthcare professionals and health service providers. With specific consent of the policyholder, Insurers may facilitate creation of ABHA number. Express consent of the policyholder shall be obtained for sharing of medical records and any other related information in every instance.

These Regulations and master circular is available on IRDAI website www.irdai.gov.in at below links:

Home>Legal>Regulations>Consolidated & Gazette Notified Regulations

https://irdai.gov.in/consolidated-gazette-notified-regulations

Home>Legal>Circulars https://irdai.gov.in/circulars

NOTE: The above FAQs offer only a simple explanation/clarification
of terms/concepts related to the provisions under Insurance Regulatory and Development Authority of India (Insurance Products) Regulations, 2024,

Master Circular on IRDAI (Insurance Products) Regulations 2024- Health Insurance dated 29/05/2024.

https://irdai.gov.in/document-detail?documentId=4942918

For complete details please refer to the relevant provisions of the applicable Regulations/ Circulars provided in the website.