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Insurance Companies to include Medical Cover for COVID-19: IRDAI

March 30, 2020

The Insurance Regulatory and Development Authority of India (hereinafter referred to as ‘IRDAI’) issued a circular on March 04, 2020[1] (hereinafter referred to as ‘Circular’) for claims related to Corona virus. The IRDAI has directed all the health insurance companies to include medical cover for COVID-19 irrespective of the nature of policy held by the consumer.

This vigilant step to include medical cover for COVID-19 has been taken by the IRDAI in wake of the recent outbreak of infamous corona virus which has now been declared as a global pandemic by WHO. The Circular clarifies the applicability of the medical cover across all kinds of medical ailments and hence resolves the dispute of whether the insurance policy would cover the said epidemic. As the COVID-19 virus outbreak is novel in nature and was not known of earlier, the prominent question that arose was whether the treatment for the said virus would be covered under the insurance policy?

The Circular has stated that all medical insurance policies would provide insurance cover in the following circumstances:

  1. Where hospitalization is covered in an insurance policy, insurers will have to ensure that the cases related to Corona virus disease are expeditiously handled.
  2. Irrespective of the nature of insurance policy, the costs of admissible medical expenses during the course of the corona virus treatment including the treatment during quarantine period will have to be settled in accordance with the applicable terms and conditions of policy contract and the extant regulatory framework.
  3. In cases where the claims have to be rejected due to any reason whatsoever, they have to be thoroughly reviewed by the Claims review committee.

Additionally, in order to provide need based health insurance coverage, the IRDAI has specified that insurers are introducing products covering various ailments including vector borne diseases (diseases caused by parasites, viruses and bacteria) for the purposes of providing need based health insurance coverage.

This comes as a pragmatic approach of the Government to ensure monetary support to those victimized by the new variant of virus causing a disease unknown and unheard of thus raising serious concerns amidst public.

[1] Guidelines on handling of claims reported under Corona Virus

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