Irdai seeks non-exclusion of critical illnesses from insurance policies

Insurance regulator Irdai mulls barring insurers from excluding several critical illnesses such as mental problems, genetic diseases, neurodevelopment disorders and psychological disorders from health insurance policies. With the increase in the number of health insurance companies as well as health insurance products in the market, Irdai in draft guidelines proposes that the health insurance industry should adopt a uniform approach while incorporating exclusions in the health insurance products.

The Insurance Development and Regulatory Authority of India (Irdai) had constituted a working group on the standardization of exclusions in health insurance contracts. After examining the recommendations of the working group, the regulator has proposed to issue guidelines on exclusions in the health insurance products.

No health insurance policy shall incorporate exclusions in the terms and conditions of the policy contract on diseases contracted after taking the policy. Also, impairment of persons’ intellectual faculties by the usage of drugs, stimulants or depressants as prescribed by a medical practitioner cannot be excluded.

"Treatment of mental illness, stress or psychological disorders and neurodegenerative disorders," should not be included in exclusions listed in the policy. Puberty and menopause-related disorders, age-related macular degeneration and behavioural and neurodevelopmental disorders too cannot be excluded, said the draft on which Irdai has sought comments from the stakeholders till May 31.

The draft said the objective of the proposed guidelines is to rationalise and standardise the exclusions in health insurance contracts that every insurer should comply with. Health insurance has undergone various changes and improvements over the years.

The draft also mentions a list of diseases that insurers were covering under their products which can be permanently excluded. These include Alzheimer's, Parkinson's, malignant neoplasms, epilepsy, pancreatic diseases, chronic kidney disease, HIV and AIDS, among others. Irdai has also proposed that insurers can incorporate waiting periods for any specific diseases but only up to four years.

The proposed guidelines would be applicable to all general and health insurers offering indemnity based health insurance policies offering hospitalisation, domiciliary hospitalisation and day care treatment.

(With inputs from agencies.)