Money & Banking

IRDAI sets up panel to examine whether life insurers can offer indemnity-based health policies

Surabhi Mumbai | Updated on February 25, 2020 Published on February 25, 2020

Life insurers have to tie up with a general or health insurance company to provide health plus life combi products   -  Getty Images/iStockphoto

The insurance regulator IRDAI has set up a committee to examine whether life insurers can offer indemnity based health policies.

“Historically, health insurance is recognized as one of the important elements of health care and health insurance premiums have been registering a significant CAGR of around 20 per cent in the preceding ten years in India. IRDAI (Health Insurance) Regulations 2016 allows Life Insurance Companies to offer Benefit based health insurance products only,” IRDAI said in a circular, adding that it has received representations from Life Insurance Companies to allow them to offer indemnity products as well.

BusinessLine had reported in September last year that life insurance companies have approached the insurance regulator for permission to start selling indemnity based health insurance products once again.

IRDAI has now set up a nine-member committee led by MR Kumar, Chairman, Life Insurance Corporation of India to look into the issue.

The committee will look into the feasibility and the business scope for Life insurance companies to offer indemnity based health insurance products and current statutory provisions that are applicable in this regard.

It is expected to submit its recommendations within two months.

The Insurance Regulatory and Development Authority of India (IRDAI) had in 2016 issued new Health Insurance Regulations under which it had barred life insurers from selling indemnity-based health insurance products either as an individual or a group policy and also from offering single premium health insurance product under the unit-linked platform.

It had allowed only general insurers and health insurers to 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.

Life insurers have to tie up with a general or health insurance company to provide health plus life combi products.

Published on February 25, 2020
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