Similarly, the company will pay 0.5 per cent of the sum assured per day for every completed 24 hours of hospitalisation, on positive diagnosis of the disease.
Factors such as isolation of patients in hotels are normally not covered under normal health policies. However, with Covid demanding such line of preventive measures, Irdai has called for inclusion of such clauses in the standard Covid product, said a public sector insurance executive.
Room, boarding, and nursing expenses will be capped at Rs 5,000 a day and intensive care unit expenses at Rs 10,000, while ambulance charges will have a maximum limit of Rs 2,000 per incidence of hospitalisation, according to the draft.
A GI Council official said: “The regulator wants to give more clarity to policyholders, hence a standard product helps in clearly spelling out what is covered, and the conditions under which the ailment is covered.”
The product may remain in force for a year or two, and have some added features that will make it more attractive, while being cheaper than other comprehensive health policies, as it will be covering Covid-19 only. In spite of being a standard product, insurers will be free to price it according to their underwriting understands.
“If we have to popularise the policy, the premium has to be low. This will be one of the options given to policyholders, especially to those who do not have a health cover, as there are high chances of catching the virus now. Compared to other health policies, the premium for the standard health policy will be less,” added the GI Council official.
Insurers are seeing a gradual decline in the average claim payout for Covid treatment. Initially, when claims started trickling in, the average claim size ranged from Rs 2-3 lakh. However, it has reduced to Rs 1.5 lakh now. Despite the decline, many private hospitals are charging high rates because of no standardisation. Insurers have been calling for standardisation in rates when it comes to Covid treatment. However, in the absence of any health regulator, the ball lies in the government’s court.
As of May 29, non-life insurers received 6,900 claims on account of Covid-19. Out of this, 3,300 worth Rs 32 crore have been settled, said people in the know. “There is a general feeling that many hospitals are taking advantage of the situation and overbilling patients. Insurance firms are required to pay this bill. Further, as directed by the finance ministry, insurers — especially public sector ones — cannot refuse these claims,” said the head of a general insurance firm.
“They are required to settle them at the earliest. A standardised product helps, especially in case of patients from hospitals that are not listed as non-PPN (preferred provider network) ones.”
Many insurers have come out with specialised Covid products. Standardisation will help bring more parity in existing products too.
“There are separate Covid products that various insurance providers have come up with. This, however, is an effort to bring a standard product for policyholders to get a clear sense of what is covered and what is not. The idea is to have a Covid-only product that has some extra elements normally not there in a typical health policy, like quarantine add-on cover,” said Sanjay Datta of ICICI Lombard.