Irdai allows inclusion of 10 more insurers for medical treatments

The Insurance and Regulatory Authority of India (Irdai), in a circular issued on Tuesday, allowed inclusion of 10 more insurers for medical treatments from its list of optional covers that were offered by health insurance companies.

In its guidelines on the Standardisation of Health Insurance, the insurance regulator has listed various medical procedures and equipment that are offered in a policy. And, it is optional for the companies to offer a cover for some the items and procedures (listed in chapter 3 of the guidelines). These are a part of the ‘non-payable' aspects of a standard policy.

Health insurance policies mainly cover hospitalisation charges, while the costs of other treatments and ancillary equipment are borne by the policyholder.

“For a policyholder, the circular does not make much of a difference. Insurers will have to decide whether they want to include them. Otherwise, these procedures would anyway be in the exclusion list,” said Puneet Sahni, head of product development at SBI General Insurance Company.

The Irdai has also deleted a few procedures in the circular. These are dental treatments that do not require hospitalisation, hormone replacement therapy, infertility, sub-fertility, assisted conception procedure, obesity treatment, if excluded in policy, psychiatric and psychosomatic procedures, corrective surgery for refractive error, treatment of sexually transmitted diseases, any expense related to retro virus or HIV/AIDS, stem cell implantation, surgery and storage, aesthetic treatment and surgery.

There are 189 items in the list of optional covers, excluding the 10 delisted procedures and items.

“Irdai has brought the number of items by excluding certain items from the list. We will have to wait and watch how insurers use this to cover various segments of customers and evolve there product,” said Prasun Sikdar, managing director and chief executive officer at Cigna TTK Health Insurance Company.

Insurance players could cover these procedures as “add-on” benefits of the existing policy, said insurers.

“With new products that we may launch, we will have to evaluate the cost impact of including some of these procedures,” said Sahni.

However, the regulator has not asked companies to include the delisted items in the standard policies, nor has it mentioned that these items must be offered as ‘add-ons’. Insurers will seek clarity in the next few days.

From a perspective of standardisation of health insurance, it needs to be further examined whether these items can be included in the standard product design and whether this would require changes in the current product designs, said Ashish Mehrotra, managing director and CEO at Max Bupa Health Insurance.