IRDAI issues draft guidelines on standardization of general clauses in Health Insurance Policy contracts

Jan 10, 2020 | by Avantis RegTech Legal Research Team


Industry Specific Compliance

The Insurance Regulatory and Development Authority of India (IRDAI) on January 10, 2020, issues guidelines on standardization of general clauses in Health Insurance Policy contracts under the IRDAI (Health Insurance) Regulations, 2016. The main objective of the guidelines is to standardize some of the general clauses that are commonly incorporated in the health insurance policy contracts of indemnity based health products. These Guidelines are applicable to all General and Health Insurers offering indemnity based Health Insurance (excluding PA and Domestic or Overseas Travel) products (both Individual and Group) covering Hospitalization, Domiciliary Hospitalization and Day care treatment. 

The followings are the standard common general clauses:-

1. The policy shall be void and all premium paid thereon shall be forfeited to the Company in the event of misrepresentation, mis-description or non-disclosure of any material fact.

2. The terms and conditions of the policy shall be a condition precedent to any liability of the Company to make any payment for claim(s) arising under the Policy.

3. The Company shall settle or reject a claim within 30 days from the date of receipt of last necessary document.

4. Any payment to the insured person for any benefit under the policy shall in all cases be a full, valid and an effectual discharge towards payment of claim by the Company to the extent of that amount for the particular claim.

5. In case of multiple policies taken by an insured person during a period from one or more insurers to indemnify treatment costs, the insured person shall have the right to require a settlement of his/her claim in terms of any of his/her policies.

6. If any claim made by the insured person, is in any respect fraudulent, or if any false statement, or declaration is made or used in support thereof, or if any fraudulent means or devices are used by the Insured Person or anyone acting on his/her behalf to obtain any benefit under this policy, all benefits under this policy shall be forfeited.

7. The insured person may cancel this policy by giving 15 days written notice and the Company shall refund premium on short term rates for the unexpired policy period.

8. The insured person will have the option to migrate the policy to other health insurance products/plans offered by the company policy by applying for migration of the policy 30 days before the premium due date of his existing policy.

9. The insured person will have the option to port the policy to other insurers.

10. The Policy shall ordinarily be renewable except on grounds of fraud, moral hazard, misrepresentation by the insured person.

11. In case of any grievance the Insured Person may approach the grievance cell at any of the company’s branches with the details of grievance.

IRDAI invites comments and suggestions from all the stakeholders on the proposed guidelines by January 25, 2020. The comments may be sent via mail at [email protected].


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