Proposed amendments to IRDAI (Health Insurance) Regulations, 2016

Sr. No.

Clause No.

Provisions to be amended

Existing Provisions

Proposed Modification

Rationale for changes made

1

2(a)

Omission of definition 2(i)(b)

“Health Services Agreement” means an agreement as defined in IRDAI (Third Party Administrators – Health Services) Regulations, 2016.

Omitted

It is proposed to dispense the mandate of written tripartite / bipartite agreements amongst Insurers, TPAs and hospitals by suitably amending Reg 31. In view of the amendments proposed to Reg. 31 (Health Services Agreements), the definition is proposed to be deleted.  Apart from Regulation 31, the term “Health Services Agreements” is not referred anywhere in the HIR,2016.

2

2 (b)

Modification of

Heading of Regulation 3

Registration and Scope of Health Insurance Business

Scope of Health Insurance Business

As words “Registration and” is redundant for the Regulation, hence, it is proposed to be omitted.

3

2 (c)

Modification of Regulation 3(b)

Life Insurers may offer long term Individual Health Insurance products i.e., for term of 5 years or more, but the premium for such products shall remain unchanged for at least a period of every block of three years, thereafter the premium may be reviewed and modified as necessary.

Provided that a life insurer may not offer indemnity based products either Individual or Group. All existing indemnity based products offered by life insurers shall be withdrawn as specified under these Regulations.

Provided also that no single premium health insurance product shall be offered under Unit Linked platform.

A life insurer may not offer indemnity based products either Individual or Group.

Regulation  specified norms on policy term in case of health policies offered by Life Insurers. Hard coding these policy term norms in regulations may not be required. As policy term of health insurance products need to be addressed as per the dynamics of the market, it is proposed to specify norms on policy term by way of guidelines notified under these regulations. Following sub-regulation is proposed to be incorporated under Regulation 3 (c).

“Insurers may offer health products for a tenure as per the guidelines as may be specified by the Authority from time to time”

Further, HIR 2016 have already stipulated for withdrawal of indemnity based products by life insurers and hence, reference regarding withdrawal of these products is redundant.

In view of the above, the sub-regulation 3(b) is proposed to be suitably substituted.

4

2 (d)

Modification of Regulation 3(c)

General Insurers and Health Insurers may offer individual health products with a minimum tenure of one year and a maximum tenure of three years, provided that the premium remains unchanged for the tenure.

“Insurers may offer health insurance products for a tenure as per the guidelines as may be specified by the Authority from time to time”

Same as above

5

2 (e) and 2 (f)

Omission of Regulation 3(d) and 3 (e)

3(d) Group Health Policies may be offered by any insurer for a term of one year except credit linked products where the term can be extended up to the loan period not exceeding five years. Provided General Insurers and Health Insurers may also offer Credit Linked Group Personal

 Accident policies for a term extended up to the loan period not exceeding five years.

Provided further, notwithstanding the provisions of Regulation 4 (b) of these Regulations, Life Insurers may offer Group Health Insurance Policies as specified in Regulation (3) (d).

3(e)Group Personal Accident Policies may be offered by General Insurers and Health insurers with term less than one year also to provide coverage to specific events. Other Insurance Products offering Travel Cover and Individual Personal Accident Cover may also be offered for a period less than one year.

Omitted

Same as above

6

2(g)

Modification of Regulation 4(b)

Health Insurance products of Life Insurers shall also be subject to the provisions  specifically provided for health products in the  following Regulations as modified from time to time:

1. IRDA (Linked Insurance Products) Regulations, 2013.

2. IRDA (Non-linked Insurance Products) Regulations, 2013.

Health Insurance products of Life Insurers shall also be subject to the provisions specifically provided for health products in the following Regulations as modified from time to time:

1. IRDAI (Linked Insurance Products) Regulations, 2019.

2. IRDAI (Non-linked Insurance Products) Regulations, 2019.

3. IRDAI (Protection of Policyholders’ Interests) Regulations, 2017.

Due to Amendments to IRDAI Linked Insurance Products & Non- Linked Insurance Products Regulations reference is made to the Regulations in vogue.

Reference of IRDAI (PPHI) Regulations also added for clarity.

7

2(h)

Omission of Regulation 5(ii)

With regard to specific withdrawal of indemnity based health products offered by life insurers pursuant to the provisions of Regulation 3 (b) of these Regulations, the product shall be closed by giving a prospective date of closure not later than three months from the date of notification of these Regulations. For existing policyholders, the policy shall continue until the expiry of the respective policy term.

Omitted

As on date there are no indemnity based products offered by life insurers and hence, reference regarding withdrawal of these products is redundant.

8

2(i)

Modification of

Regulation 7

No Group Health Insurance Policy shall be issued by any Insurer where a Group is formed with the main purpose of availing itself of insurance. There shall be a clearly evident relationship as specified by the Authority from time to time between the members of the group and the group policyholder.

The Group shall have a size as determined by the Insurer which shall be applicable for all its group policies, subject to a minimum of 7, to be eligible for issuance of a Group Insurance Policy. Further, Insurer shall follow the Guidelines specified by the Authority on Group Insurance, from time to time.

“Insurers may offer group health products as per the guidelines as may be specified by the Authority from time to time.”

The norms referred in the existing regulatory provisions relate to operational aspects of the group business. Hard coding these norms and the minimum number of lives to be covered in a group policy in regulations may not be required.

It is proposed to specify the relevant provisions in the guidelines.

9

2(j)

Modification of Regulation 8 (b)

The underwriting policy shall also cover the approach and aspects relating to offering health insurance coverage not only to standard lives but also to sub-standard lives. It shall have in place various objective underwriting parameters   to differentiate the various classes of risks being accepted in accordance with the respective risk categorisation.

The underwriting policy shall also cover the approach and aspects relating to offering health insurance coverage not only to standard lives but also to “non-standard” lives. It shall have in place various objective underwriting parameters   to differentiate the various classes of risks being accepted in accordance with the respective risk categorisation.

The word ‘sub-standard’ is proposed to be replaced with the word “non-standard” keeping in view the sensitivities of persons affected with diseases/disabilities.

10

2(k)

Modification of Regulation 8 (d)

General Insurers and Health Insurers may devise mechanisms or incentives to reward policyholders for early entry, continued renewals (wherever applicable), favourable claims experience, preventive and wellness habits and disclose upfront such mechanism or incentives in the prospectus and the policy document, by complying with the norms specified under Product Filing Procedure Guidelines. Provided that what is proposed to be covered as part of wellness habits and preventive habits be clearly defined in each and every product.

Insurers may devise mechanisms or incentives to reward policyholders for early entry, continued renewals (wherever applicable), favourable claims experience, preventive and wellness habits and disclose upfront such mechanism or incentives in the prospectus and the policy document, by complying with the norms specified under Product Filing Procedure Guidelines. Provided that what is proposed to be covered as part of wellness habits and preventive habits be clearly defined in each and every product.

The words ‘General Insurers and Health Insurers’ are proposed to be replaced with the word ‘Insurers’ to encourage life insurers also to incentivize policyholders for early entry, continued renewals (wherever applicable), favourable claims experience, preventive and wellness habits etc, as applicable

11

2 (l)

Omission of Regulation 9 (a)

Every Life Insurer, General Insurer and Health Insurer shall devise a proposal form to be submitted by a proposer seeking a health insurance policy. Such form should capture all the information necessary to underwrite a proposal in accordance with the stated Underwriting Policy of the Company.

Omitted

Norms on proposal form are already specified in Regulation 8 of IRDAI (Protection of Policyholders’ Interests) Regulations, 2017. Hence, Regulation 9 (i) is proposed to be omitted.

12

2 (m)

Modification of Regulation 12(ii)

Except travel insurance products, personal accident products and Pilot Products referred to in Regulation 2(i) (l) herein, once a proposal is accepted and a policy is issued which is thereafter renewed periodically without any break, further renewal shall not be denied on grounds of the age of the insured.

“Except travel insurance products and Pilot Products referred to in Regulation 2(i) (l) herein, once a proposal is accepted and a policy is issued which is thereafter renewed periodically without any break, further renewal shall not be denied on grounds of the age of the insured”

Personal Accident products are also proposed to be brought under the ambit of lifelong renewability in the interest of the policyholders.

13

2 (n)

Modification of  Heading of Regulation 13

Renewal of Health Policies issued by General Insurers and Health Insurers (not applicable for travel and personal accident policies)

Renewal of Health Policies issued by General Insurers and Health Insurers (not applicable for travel policies)

Same as above

14

2(o)

Omission of Regulation 15

i. The cost of any pre-insurance medical examination shall generally form part of the expenses allowed in arriving at the premium. However, in case of products with term of one year and less, if such cost is to be incurred by the insured, not less than 50% of such cost shall be borne by the insurer once the proposal is accepted, except in travel insurance policies.

ii.Insurers shall maintain a list of medical examiners and institutions where such pre-insurance medical examination may be conducted whose reports will be accepted by them. Details of fee payable shall be made available to the prospective policyholder at the time of pre-insurance medical examination on demand.

Omitted

These are operational matters, hence considered to be left to the insurers to decide.

15

2 (p)

Modification of Heading of Regulation 25

“Loadings on Renewals”

“Discount and Loadings”

Heading modified to also cover the discount aspects covered in the Regulation.

16

2 (q)

Modification of Regulation 25 (i)

For Individual products, the loadings on renewal shall be in terms of increase or decrease in premiums offered for the entire portfolio and shall not be based on any individual policy claim experience.

For Individual products, the loadings on renewal shall be offered for the entire portfolio and shall not be based on any individual policy claim experience”

Reference to the word ‘decrease’ when speaking about ‘loadings’ is not relevant. Hence, the Regulation is proposed to be modified to correct the expression.

17

2 (r)

Modification of Regulation 25 (iii)

No Insurer shall resort to fresh underwriting by calling for medical examination, fresh proposal form etc. at renewal stage where there is no change in Sum Insured offered. Provided that where there is an improvement in the risk profile, the Insurer may endeavour to recognise that for removal of loadings at the point of renewal.

“No Insurer shall resort to fresh underwriting by calling for medical examination, fresh proposal form at renewal stage where there is no change in Sum Insured offered. Provided that where there is an improvement in the risk profile, the Insurer may endeavour to recognise that for removal of loadings or offering discount at the point of renewal”

Regulation is proposed to be modified to encourage insurers to offer discount where there is an improvement in the risk profile.

18

2(s)

Modification of Regulation 28

In addition to the requirements stipulated in IRDA (Protection of Policyholders’ Interest) Regulations, 2002 as amended from time to time the policy document shall contain:

“In addition to the requirements stipulated in IRDAI (Protection of Policyholders’ Interest) Regulations, 2017 as amended from time to time the policy document shall contain:”

Amended IRDAI (PPHI) Regulations is now specified.

19

2(t)

Modification of Regulation 28 (iv)

Penal interest provision shall invariably be incorporated in the policy document as per Regulation 9(6) of (Protection of Policyholders’ Interests) Regulations, 2002 as modified from time to time.

Penal interest provision shall invariably be incorporated in the policy document as per the applicable provisions of (Protection of Policyholders’ Interests) Regulations, 2017 as modified from time to time.

Amended IRDAI (PPHI) Regulations is now specified.

20

2 (u)

Modification of Regulation 30 (b)

Cashless facility shall be offered only at establishments which have entered into an Agreement with the insurer to extend such services. Such establishments will be termed as Network Providers.

“Insurer shall be responsible for ensuring availability of cashless facility at network providers.”

Existing regulations mandate bipartite / tripartite agreements which are considered highly prescriptive. While shifting the onus of ensuring availability of cashless facility at network providers to the insurers, it is proposed to leave it to the insurers the manner of engaging the network providers. Network providers is already defined in the IRDAI (TPA-HS) Regulations, 2016. Hence, the proposed modification.

21

2(v)

Omission of Regulation 30 (g)

The identification card shall, at the minimum, carry details of the policyholder and the logo of the insurer. Insurers shall endeavour to issue Smart Cards with features such as cards with Quick Response Code, Magnetic reader to enable the TPAs and Network Providers offer health services seamlessly.

Omitted

Mentioning the requirements on an Id card is redundant and insurers know what to mention. Hence, the proposed modification.

22

2(w)

Modification of heading of Regulation 31

Health Services Agreements

“Norms related to Network Providers”

In view of the amendments proposed to Reg. 31, change of heading of Reg. 31 is necessary.

23

2(x),2(y) and 2(z)

Omission of Regulation 31 (a),31(b) & 31 (c)

a. Insurance companies may offer policies providing cashless services to the policyholders provided:

i.The services are offered through network providers who have been enlisted to provide medical services under a direct written agreement with the insurer where there is a direct arrangement or by a tripartite agreement amongst health services provider, the TPA and the insurer where it is through a TPA. Where an insurer wishes to utilise the services of a TPA, it shall ensure that the written agreement is entered into for defined services with a TPA holding a valid Certificate of Registration issued in accordance with the IRDAI (Third Party Administrators – Health Services) Regulations, 2016 as may be amended from time to time.

b.The Agreements which shall be entered into between / amongst insurers, network providers or TPAs shall cover the following amongst others:

 i.    The tariff applicable with respect to various kinds of healthcare services being provided by the network provider.

ii.    A clause empowering the insurer to cancel or modify the agreement in case of any fraud, misrepresentation, inadequacy of service or other non-compliance or default on the part of TPA or network provider.

iii.    A standard clause as may be agreed upon providing for continuance of services by a network provider to the insurance company if the TPA is changed or the agreement with TPA is terminated.

iv.    A clause providing for opting out of network provider from a given TPA or disempanelment of a network provider by a TPA subject to Guidelines specified by the Authority, if any, for reasons of inadequacy of service rendered by the TPA to the network provider.

v.    A clause specifically fixing the onus on the Insurer to deny or repudiate a claim.

vi. A clause enabling insurer to inspect the premises of the Network Provider at any time without prior intimation.

c.Insurers and TPAs shall comply with standard clauses to be incorporated in all such agreements as specified by the Authority by way of guidelines.

Omitted

Agreements to be entered if any with the hospitals will be the operational prerogative of the insurers. Contracting parties shall decide the terms of agreement. We have already proposed to stipulate that the insurers shall ensure availability of cashless services to policyholders.

24

2(aa)

Modification of

Regulation 31(d)

The insurance company shall endeavour to enter into Agreements with adequate number of both public and private sector network providers across the geographical spread. The copy of the agreement shall be maintained by the Insurer for a period of not less than five years from the date of the expiry or termination of the agreement.

“The Insurance Company shall endeavour to arrange adequate number of both public and private sector network providers across the geographical spread for providing cashless facility”

Regulation is modified removing the requirement of maintaining a copy of the agreement by the Insurer for a period of not less than five years from the date of the expiry or termination of the agreement as it is operational matter. In the first part of the clause reference to the word ‘agreements’ is replaced with the word ‘arrange’.

25

2(bb)

Omission of Regulation 35 (b)

The respective claim settlement files shall be handed over to the insurer within 15 days thereof.

Omitted

This is operational matter to be decided by the contracting parties. Hence, proposed to be omitted

26

2(cc)

Modification of

Clause 4 of Schedule –I

In case insurer is willing to consider the proposal for portability even if the policyholder fails to approach insurer at least 45 days before the renewal date, it is free to do so.

“Provided where the proposal for portability is considered, it is the responsibility of the insurer to obtain the entire claim history of prior policy years from the existing insurer(s). No claim shall be repudiated on the grounds of non-disclosure of any of the claims already preferred or made with the existing insurers.”

Regulation is modified to ensure that after portability, no subsequent claim related to the claims already made with the existing insurer shall be repudiated by the new insurer under “non-disclosure” clause.

27

2(dd)

Modification of

Clause 7 of Schedule –I

On receipt of intimation referred under Clause (1) above, the insurance company shall furnish the applicant, the Portability Form as set out in Annexure-I to these guidelines together with a proposal form and relevant product literature on various health insurance products which could be offered.

On receipt of intimation referred under Clause (1) above, the insurance company shall furnish the applicant, the Portability Form as set out in Annexure-I together with a proposal form and relevant product literature on various health insurance products which could be offered.

To improve clarity, the phrase ‘to these guidelines’ after Annexure-I is proposed to  be deleted.

28

2(ee)

Modification of

Clause 9 of Schedule –I

On receipt of the Portability Form, the insurance company shall seek the necessary details of medical history and claim history of the concerned policyholder from the existing insurance company. This shall be done through the web portal of the IRDAI.

Within 5 working days of receipt of the Portability Form, the insurance company shall seek the necessary details of medical history and claim history of the concerned policyholder from the existing insurance company. This shall be done through the web portal being maintained by IIB.

In order to make it a time bound exercise, timelines have been prescribed for calling for claim details from the existing insurer by a porting-in insurer.

29

2(ff)

Modification of

Clause 12 of Schedule –I

On receipt of the data from the existing insurance company, the new insurance company may underwrite the proposal and convey its decision to the policyholder in accordance with the Regulation 4 (6) of the IRDA (Protection of Policyholders’ interest) Regulations, 2002.

On receipt of the data from the existing insurance company, the new insurance company may underwrite the proposal and convey its decision to the policyholder in accordance with the Regulation 8 (6) of the IRDAI (Protection of Policyholders’ interests) Regulations, 2017.

Amended IRDAI (PPHI) Regulations along with applicable provisions is now specified.

30

2(gg)

Insertion of Clause 20 in Schedule-I

The websites of the insurers shall contain information on sequence of steps that shall be followed along with the responsibilities of policyholders during porting of the health insurance policy

To bring in transparency and for policyholder education, procedure on porting-in is proposed to be mandated to disclose in the websites.

31

2(hh)

Modification of

Clause 3(b)(viii)  of Schedule –II

Insurers shall ensure filing of the advertisements in accordance with IRDA (Insurance Advertisements and Disclosures) Regulations, 2000 within seven days from the date of issuing the advertisement with the Authority.

Insurers shall ensure filing of the advertisements in accordance with IRDAI (Insurance Advertisements and Disclosures) Regulations, 2021 within seven days from the date of issuing the advertisement with the Authority as amended from time to time.

Latest  Regulations on  (Insurance Advertisements and Disclosures) specified.

32

2(ii)

Insertion after

Clause 2 of Schedule III

After Clause 2 of Schedule III the following clause shall be inserted namely,

2 (a) Regulation 3 (c ): Tenure of health insurance products.