Responding to media reports on hike in health insurance premium rates by general insurers and standalone health insurance companies, IRDAI has clarified that the increase in health insurance premium is in line with the regulatory norms.
The insurance has allowed general insurance companies and standalone health insurance companies to do minor modifications to their existing policies. Among these minor modifications, insurers can increase or decrease premium of existing policies by 5%.
IRDAI said, “Some of the news items attributed the increase in health insurance premiums to certain recent regulatory initiatives taken by IRDAI. In this regard, it is clarified that insurers were permitted to change the base premium upto +/- 5 per cent of originally approved premium rates in order to comply with the guidelines on standardization of exclusions as a onetime measure for seamless transition of existing products to ensure viability and sustainability. As on 30th September, 2020, out of 388 products, premiums were increased by general and health insurers upto 5% of the then prevailing rates only in case of 55 products.”
Further, the insurance regulator clarified that only 5 health insurance policies have seen revision of over 5% due to their incurred claims experience.