Right to choose from multiple options is a good thing, but not always. If you have ever searched for a suitable health insurance cover
, you know how varied plans in this category can confuse a prospective buyer. The Insurance Regulatory and Development Authority (Irda) plans to introduce common standards to make it easy for the consumers.
At present, there are at least six type of policies that come under the health insurance umbrella-individual indemnity policies, critical illnesses plans, personal accident and disability covers, unit-linked health plans, hospital cash policies and top-up policies. Different interpretations of key policy terms by insurers add to the confusion and often lead to disputes
In order to reduce ambiguity, bring order in the industry and enable easy comparison of policies, Irda has issued an exposure draft on health insurance. The draft includes standard definitions for 46 main terms of health insurance policies to be followed by all insurers. The list includes terms such as pre-existing diseases, cashless service, and maternity expenses. It also includes standard nomenclature and procedures for critical illnesses.
The draft also tries to reduce the clutter by creating a standard list of excluded items (203 in total) for hospitalisation indemnity policies. Insurers will have the freedom to cover expenses incurred on excluded items, but they cannot exclude any hospitalisation expense not part of the standard exclusion list.
The regulator has also suggested standard formats
for claim and billing forms to streamline and speed up the processing of claims.