Health Insurance: Standard policy norms relaxed by IRDAI – Check details

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Updated: January 25, 2020 1:46:44 PM

All general and health insurance companies may offer a Standard Health Insurance Product even before April 1, 2020.

Standard Health Insurance Product, SHIP, Arogya Sanjeevani Policy, hospitalization expenses, pre-post hospitalization, Ayush treatment, cumulative bonusArogya Sanjeevani Policy will be available on both individual lives and on Family Floater basis.

Good news for the buyers of health insurance! In a circular dated January 24, the insurance regulator IRDAI has stated that the insurers may start offering the Standard Health Insurance Product anytime before the deadline of April 1. However, they need to definitely offer this product to buyers post that date. It may be noted that for the benefit of health insurance buyers, The Insurance Regulatory and Development Authority of India (IRDAI) had earlier asked all general and health insurance companies to offer a Standard Health Insurance Product from April 1, 2020, onwards. The Standard Health Insurance Product (SHIP), called Arogya Sanjeevani Policy, is expected to take care of basic health needs, carry similar policy wordings and enable seamless portability among the insurers. The new standard health policy is expected to make the buying experience much simpler for the individuals.

In its communication, IRDAI has stated that in partial modification of the Guidelines on Standard Individual Health Insurance Product, it is clarified that the insurers can start offering “Arogya Sanjeevani Policy” before 1st April, 2020. They, however, have to ensure that this product is definitely offered on or before 1st April, 2020. However, if any insurer is currently not offering indemnity based health insurance products at all, the above stipulation about an early launch will not apply to those. As and when those insurers start offering indemnity based health insurance products, they will have to also offer the standard product “Arogya Sanjeevani Policy”

To keep the comparison between different Standard Health Insurance Product (SHIP) easier, the name of the plans of each insurer will have to follow the same nomenclature. For example, Arogya Sanjeevani Policy SBI General insurance, Arogya Sanjeevani Policy Apollo Munich etc.

Arogya Sanjeevani Policy is an indemnity policy which means it will work on a reimbursement basis. The claim will be paid by the insurer depending on the amount of hospital bill but restricted to the sum insured. Each Arogya Sanjeevani Policy of the insurer will have some basic mandatory covers which shall be uniform across the market. The premium, however, may be set by the insurers on their own.

Some common mandatory coverage will be hospitalization expenses, pre-post hospitalization, Ayush treatment, cumulative bonus amongst others.

Arogya Sanjeevani Policy will be available on both individual lives and on Family Floater basis. The Minimum and maximum sum insured in the Arogya Sanjeevani Policy will be Rs 1 lakh and Rs 5 lakh respectively. The minimum and maximum entry age will be 18 and 65 years while for children under Family Floater policies, it will be 3 months to 25 years.

It remains to be seen which insurance company launches the Arogya Sanjeevani Policy for the first time in the industry. Once the policy wordings are evaluated, it will result in a better buying decision.

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