Coronavirus crisis: IRDAI allows insurers to offer short-term health policies for COVID-19

Amid mounting COVID-19 cases in the country, insurance regulator Insurance Regulatory and Development Authority (IRDAI) has allowed the health and general insurers to offer short-term health insurance policies that will give coverage against coronavirus infection. With an objective of making available insurance protection to various sections of people in the prevailing COVID-19 pandemic, it is considered that short term health insurance policies providing coverages specific to COVID-19 disease is the need of the hour, the insurance regulator said. "Accordingly, all insurers (Life, General and Health Insurers) are allowed to offer COVID - 19 specific short term health insurance policies subject to these guidelines," it added.

Short term health policy for the purpose of these guidelines means any health insurance policy contract, which has been issued for a policy term of less than 12 months. "Notwithstanding the provisions of regulation 3 (b), 3(c) and 3(d) of IRDAI (Health Insurance) Regulations, 2016, life, the general and health insurers are permitted to devise need-based, short term health insurance policies providing coverages specific to COVID-19 disease, subject to the following conditions," IRDAI said in a notification.

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Guidelines for short-term insurance cover

• These policies are permitted to be devised offering health insurance cover specific to only COVID-19.
• They are permitted to be offered both as individual or group products.
• Short-term policies may be issued for 3-11 months. In between this period, the policy term should be in multiples of completed months.
• A policy term less than three months is not permitted.
• Where the term of the policy is fixed as 12 months, the same is not considered as short-term health policy.
• Optional covers that enhance the health insurance coverage are permitted to be offered for the same policy duration.
• No separate add-ons are permitted.
• Insurers are advised to devise inclusive short-term health insurance products. Where waiting periods are part of the product, such a waiting period shall not exceed fifteen days.
• In light of the provisions of Regulation 3 (b) of IRDAI (Health Insurance) Regulations, 2016, life insurers are permitted to offer the only benefit based short term health insurance policies.
• General and health insurers can offer both indemnity-based and benefit-based short term health insurance policies.
• Lifelong renewability, migration and portability are not applicable to the short term health policies offered by general and health insurers.
• Insurers will ensure that short-term health insurance products comply with the norms on pricing stipulated in IRDAI (Health Insurance) Regulations, 2016.
• These guidelines will remain valid till March 31, 2021, unless extended further.

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