The Insurance Regulatory and Development Authority of India (Irdai) has ordered a standard individual Covid-19 health insurance cover to all general and health insurance companies from June 15. The maximum sum insured for this product will be Rs 5 lakh and the minimum. 50,000
Insurance companies are still working on the premium amount for this product, but it is estimated that the premium will be in the range of Rs 2,000-3,000 for an insurance amount of Rs 5 lakh. This policy will be a standard product with common policy acronyms across the industry.
In its draft product, the insurance regulator stated that the base cover for novel coronaviruses would be provided on an indemnity basis, while add-ons would be provided on a profit basis. Under indemnity health insurance plans, insurers cover the cost of medical expenses during hospitalization, while defined benefit plans pay a lump regardless of actual hospital expenses.
Currently insurance companies such as Star Health and Allied Insurance, ICICI Lombard General Insurance and Reliance General Insurance are providing other Covid-19 specific covers. However, most of the products are either on group platforms or have profit plans.
“The new standard scheme will be an indemnity product and most of the schemes currently offered to policyholders are beneficial policy and one of the major differences. The sum insured in current policies is lower than the cost of anyone tested positive for novel coronoviruses, “said a senior official at a top private sector insurance company. Currently the sum insured for Covid-19 products is 25,000. -2 lakhs in the range of Rs.
According to officials in the non-life industry, the average claim for novel coronavirus is around Rs 2–2.5 lakh. In many cases where the patient’s condition is critical and has been admitted to the intensive care unit (ICU), the claims are in the range of Rs 6-8 lakh.
As of 6 June 2020, general insurance companies have received more than 9,700 claims, amounting to Rs 150 crore for the novel coronavirus. Of the total claims, around 5,700 have been registered in Maharashtra only. Data from the General Insurance Council also shows that insurance companies have received 1,500 claims from Delhi (including the National Capital Region), 1,022 claims in Tamil Nadu and 522 in West Bengal.
However, industry players say that it is always better to buy comprehensive health cover than to buy such disease specific cover. Anand Roy, MD, Star Health and Allied Insurance, says, ‘I always suggest that a person should go for comprehensive cover if they can afford it. But in today’s scenario many people are going through financial stress and at the same time there is danger of novel coronavirus. Therefore, if they do not have a health insurance policy and are not in a position to buy comprehensive cover, they should definitely buy this policy. ”
Do you know what is The FE Knowledge Desk explains each of these in more detail in Financial Express Explanation. Also get live BSE / NSE stock prices, latest NAV of mutual funds, best equity funds, top gainers, top losers on Financial Express. Don’t forget to try our free income tax calculator tool.