"Health insurance addresses a major area of public concern. Although it is rapidly growing, access to health insurance still remains limited and add to it complaints especially due to variable interpretations of key policy terms are enormous," the exposure draft on standardisation in Health Insurance of IRDA said.
The Insurance Regulatory and Development Authority (IRDA) has defined 46 commonly used terms in health insurance and standardised 11 critical illness terms.
It said the standard terms would reduce ambiguity, enable all stakeholders to provide better services, IRDA said adding that insurers should give all the 46 definitions in the policy document.
"In view of resolving the differences in the definitions of terms on critical illnesses adopted by the different insurers which are creating confusion in the minds of consumers and the industry ..., 11 critical illness terms have been standardised to be adopted uniformly across industry," IRDA said.
As per the exposure draft, critical illness includes cancer, first heart attack, kidney failure, stroke, permanent paralysis of limbs, coma, organ transplant and multiple sclerosis.
Further, the IRDA has allowed insurers to exclude certain disease, including skin cancer and HIV induced diseases, from the 11 critical illnesses.
The exposure draft also listed 203 items, including diaper and internet charges, which are excluded from hospitalisation indemnity products.
Further to streamline the claim process, the exposure draft has also suggested a standard agreement between Third Party Administrator (TPA) and insurer and hospital and insurer. It also suggested a common industry wide pre- authorisation and claim form.
The regulator has sought feedback from all stakeholders within 10 days, starting from January 11.