When it comes to health insurance, most of us are rather interested in just buying a health insurance policy and choose to ignore the technicalities of the product we are investing in. We might consider the features mentioned and try and understand the benefits promised, but do we spare some time to understand the terms and conditions behind such benefits?
Health insurance companies offer different products and though the technical conditions pertaining to these products are almost similar, there might be fine differences. Hence, it might not be an easy task to understand the finer nuances of the plans and then compare them. Wouldn’t it become easier if the terms and conditions of all health insurers are standardized so that knowledge of just one would suffice?
To make things stress-free, the Insurance Regulatory and Development Authority (IRDA) has made specific standardization norms with reference to health insurance companies. Every insurer offering any health plan has to comply with six types of standardization rules as prescribed by the IRDA. Let us understand what they are:
• Definition of commonly used terms
You might have seen common terms in your health insurance policy like hospitalization, pre and post hospitalization, day care treatments, OPD expenses, co-payment, deductibles , etc. which specify the benefits payable and the restrictive conditions of your policy. IRDA has sought to make the definition of such 46 commonly used terms of your health plan uniform. So, any health plan which has any of the specified 46 terms will have the same standard definition.
• Definitions of Critical Illnesses covered
Health insurance plans compete with one another in context of the benefits offered pertaining to critical illness. You may find certain plans covering 7 or 8 critical illnesses while others claim to cover as many as 20. IRDA has defined 11 common critical illnesses and specified the scope and extent of coverage of such illnesses. Insurers who cover the specified illnesses will have to stick with this definition and scope. The illnesses include Cancer of specified severity, first heart attack of specified severity, open chest CABG, coma of specified severity, kidney failure, etc.
• Pre-authorization and claim form
To simplify the claim process, the pre-authorization form and the required claim form have been standardized. This will ensure smooth processing and also minimize the data entry errors through an Optical Character Recognition format. Such forms are required to be provided to the policyholder for a speedy registration of claim.
• List of exclusions
IRDA has prepared a standard list of 199 exclusions which cover the entire scope of an exclusion list. Insurers are free to choose any number of exclusions from this list but any other exclusion will not be included in the plan if it does not appear in the list. Moreover, exclusions mentioned in the list may be included in the plan only if the plan’s scope of coverage permits.
• Application form, Database sheet and Customer Information Sheet
To simplify the buying process, the application form and other required documents have been made uniform with the corresponding details. So, almost all health plans will have similar application forms where the product details along with the customer’s details will be mentioned in a uniform format.
• Agreement between TPAs and the insurer and also between hospitals and the insurer
The best part of your health policy is the ability to opt for a cashless hospitalization where your insurer has a tie up with. And thanks to the involvement of the TPA, this process is quite hassle-free. It is further supported with the agreement the insurer has with the TPAs and tied-up hospitals and contains standard clauses which protect the policyholder’s interests.
The IRDA has taken these steps for as much standardization as possible to protect the interest of the policy holder. This ensures the entire dealing with the insurer right from policy purchase to claims is free from ambiguity. Rather than fretting over the technicalities of your policy document, arm yourself with these standardized details and your health plan will not spring you any surprises.