IRDAI sets three-hour limit to settle cashless health claims
Vijay C Roy
Chandigarh, May 30
In a significant development, the insurance regulator — Insurance Regulatory and Development Authority of India (IRDAI) — released a master circular on health insurance specifying that an insurer will have to decide on cashless authorisation within an hour of its request and a three-hour limit to clear the cashless claim.
According to experts, the move is a master stroke towards empowering policyholders and bringing in inclusive health insurance growth. Also, it will enhance the confidence of customers and thus increase the insurance penetration in the country.
Currently, the health insurance penetration in India is extremely low due to limited reach, lack of awareness and education. In the fiscal year 2021-22, the number of persons covered under health insurance in the country stood at 52.04 crore, according to a reply to a question by Union Minister of State for Finance Bhagwat Karad in the Lok Sabha last year. A majority of the people are covered under the government-funded health insurance schemes, followed by the corporate sector, which is largely limited to urban households. There are only around four crore individual health insurance policies.
“Decide on cashless authorisation requests within one hour and final authorisation on discharge from hospital within three hours of request from the hospital,” the circular said. The master circular on health insurance products repealed 55 circulars issued earlier.
Experts feel that the IRDAI’s new directives are a game-changer for the health insurance industry. This move ensures that policyholders receive swift approvals, allowing them to access necessary medical treatment without financial delays.
According to the circular released by the regulator, health insurance policy-holders will also be able to avail a discount on the premium payable if there were no claims made in the previous year.
The IRDAI has also asked general and health insurance companies to reward the policyholders by giving them ‘No Claims Bonus’ (NCB) in the form of either increasing the sum insured or by offering a discount on the premium amount if they have not made any claims.
The circular also said wider choice should be provided by the insurers by making available products, add-ons, riders by offering diverse insurance products catering to all ages, regions, medical conditions, all types of hospitals and healthcare providers to suit the affordability of the policyholders.
Insurance companies have been given time till July 31 to put the necessary systems and procedures in place.
55 circulars repealed
The IRDAI has released a master circular on health insurance products, repealing 55 circulars issued earlier. The new norms will require insurers to decide on cashless authorisation requests within one hour and final authorisation on discharge from hospital within three hours of request from the hospital
