IRDAI allows insurers to offer short-term health policies against COVID-19

Short-term policies may be issued for a minimum term of three months to a maximum term of eleven months

Amid mounting COVID-19 cases in the country, regulator Insurance Regulatory and Development Authority of India (IRDAI) allowed the health and general insurers to offer short-term health insurance policies that will give coverage against the coronavirus infection.

With an objective of making available insurance protection to various sections of people in the prevailing COVID-19 pandemic, it is considered that short-term health insurance policies providing coverages specific to COVID-19 disease is the need of the hour, it said in a circular.

Accordingly, all insurers (life, general and health) are allowed to offer COVID-19 specific short-term health insurance policies subject to the guidelines, said IRDAI.

“Short-term policies may be issued for a minimum term of three months to a maximum term of eleven months. In between three months and eleven months, the policy term shall be in multiples of completed months,” it said while issuing the guidelines.

However, a policy term less than three months is not permitted.

IRDAI asked the insurers to devise inclusive short-term health insurance products “where waiting periods are part of the product, such waiting periods shall not exceed 15 days.”

Life insurers are permitted to offer only benefit based short-term health insurance policies while general and health insurers can offer both indemnity based and benefit-based policies.

The guidelines will remain valid for the issue of short-term policies till March 31, 2021, unless extended further.

As per the guidelines, short-term health policy means any health insurance policy contract which has been issued for a policy term of fewer than 12 months.

Short-term policies can be offered both as individual or group products, the circular said.

Earlier in March, IRDAI had asked the general and health insurers to design need-based products covering costs of treatment of coronavirus disease. 

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