The bad news around Covid-19 has no end. If you are someone who has recently recovered from Covid-19 and looking to to buy a life or a health insurance policy, you may not get it. The life and health insurers are adopting stringent underwriting norms for Covid-19 recovered patients. In most cases, they will have to wait for up to six months before their proposal form is accepted.
"Insurance companies are not sure of long-term effects of Covid-19. Different companies are taking different stance on people who have just turned Covid-19 negative. Some companies have a cool-off period of three months, others six months or for some no cool-off period at all. It depends on underwriting guidelines of an insurer," says Amit Chhabra, head- Health Insurance, Policybazaar.com.
The policy proposer must be upfront and honest about Covid-19 history and submit relevant documents such as discharge summary (if hospitalised) and Covid-19 negative report. Even caregivers are supposed to declare it in the proposal forms. After you fill up the proposal form, the underwriting team comes back to you to fetch more details, if needed. Based on your health records the insurers take a call about accepting, rejecting or postponing the proposal form. In some cases, Covid-19 recovered patients may have to undergo medical tests as well.
"Medical tests will not be mandated just on the basis of a COVID-19 declaration. A customer is subjected to it depending on various factors such as age/sum insured opted for/ any pre-existing conditions etc. Having said that, insurers may further refine the tests that COVID recovered patients may be subjected to, if need be," says Sanjay Datta, Chief-Underwriting, Claims and Reinsurance, ICICI Lombard General Insurance.
He points out it is hard for anyone to put an "x" number of days as cool-off period for the novel Covid-19 disease. "COVID-19 is known to have long terms side-effects affecting major organs such as the lungs, heart etc. With the advent of the second wave, even the medical fraternity is gradually learning about new long-term implications of the disease which were not seen to a large extent in the first wave," says Datta.
Star Health & Allied Insurance, which has no cool-off period for Covid-19, says insurance industry needs to be more inclusive to increase penetration of health insurance. "We have no special criteria to cover Covid-19 recovered patients. The problem is many insurance companies do not engage with qualified medical doctors in underwriting areas. Our underwriting team comprises a highly qualified expert panel. We have studied the data. We are convinced that without any compromise we are willing to cover people who were diagnosed with Covid-19. They just have to declare it and submit discharge summery," says Dr. S. Prakash, Managing Director, Star Health and Allied Insurance.
Life insurers are much more stringent in underwriting processes due to life policies being a long-term contract. They are not even considering the proposal form before the cool-off period ends or if they are, they are loading the premium. Industry sources inform HDFC Life has a waiting period of 60 days, while at Max Life it is 90 days.
"For recovered patients, if they have a history of COVID hospitalisation in the last three months or if they were home quarantined in the last 30 days, the waiting period is a minimum of three months," says Kamlesh Gupta, Appointed Actuary, Aegon Life Insurance.
He further cautioned that one should maintain the medical records of the COVID diagnosis. As records for all tests and treatments are important to prove the Covid recovery for policy eligibility. "Also, it is important to maintain the COVID 19 vaccination details. Due to the uncertain nature of COVID 19, there can be additional medical tests required to rule out medical risks as required by the Underwriter," he says.
The uncertainty around Covid-19 and developing strains and the rising claims are making insurers jittery about on-boarding Covid-19 patients. Although Covid-19 does not qualify as a chronic disease, the degree of scrutiny is greater for Covid-19 recovered patients.
Sajja Praveen Chowdary, Head - Life Insurance, Policybazaar.com emphasises there is nothing unusual about introducing cool-off period for Covid-19 patients. "Life insurers always ask you if you have had a severe disease in the last six months. Earlier most people were answering no to the question. Now a lot of people are declaring having been Covid-19 positive. As a result, more and more people are falling in this category," says Praveen.
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