Regulator IRDAI on Tuesday asked insurance companies not to impose a waiting period of 15 days on renewal of Corona Kavach or Corona Rakshak policies by insured persons. As per the guidelines issued by the Insurance Regulatory and Development Authority of India (IRDAI), the short-term Corona Kavach or Corona Rakshak policies are issued by insurance companies for three-and-a-half months, six-and-a-half months or nine-and-a-half-months.
These policies are designed to cover the cost of treatment of coronavirus. In a circular, IRDAI further said insurers also have the choice to allow renewal, migration and portability for these COVID specific standard health products -- Corona Rakshak Policy, Corona Kavach Policy and Group Corona Kavach policy.
"Corona Kavach' and 'Corona Rakshak' policies of any tenure may be renewed for further terms of three-and-a-half months (3 months), six-and-a-half months (6 months) or nine-and-a-half months (9 months) as per the option exercised by the policyholder," it said. However, renewals, if any, may be done before the expiry of the existing policy contract.
"Where policy is renewed, additional waiting period of 15 days shall not be imposed and the coverage shall be continued seamlessly," IRDAI said. It further said that during renewal, sum insured may be allowed to be changed by the policyholder.
For any increase in the sum insured, the waiting period shall start afresh only for the enhanced portion of the sum insured, the circular said, adding that Corona Kavach and Corona Rakshak policies are permitted to be renewed till March 31, 2021. On portability, IRDAI said general and health insurers are permitted to allow portability of Corona Kavach (individual) policy from one insurer to another.
"The accrued gains of waiting period served in the existing Corona Kavach policy shall be protected in respect of coverage of COVIDd-19, by the porting-in insurer," it added. Also, in respect of Corona Kavach individual policies, insurers have the choice to offer migration to any other indemnity based health insurance product offered by them as per the option exercised by the policyholder.
Commenting on IRDAI's circular, Amit Chhabra, Head-Health Insurance, Policybazaar.com said amongst the various guidelines issued, the most important for consumers is that they can now shift from a corona specific health policy to a comprehensive health insurance cover that will apart from providing them protection from COVID-19 will also provide adequate coverage for more severe ailments like cancer, heart disease, accidents, kidney-related ailments and many more. "The consumers even have the option of enhancing the sum insured of their policy. This is being seen as a welcome move as more and more people will now switch to comprehensive cover for overall protection thus enhancing the health insurance penetration rate in India," Chhabra said.
Insurance companies had launched short-term 'Corona Kavach' health insurance policy to cover medical expenses of the COVID-19 positive patients in July. Sum insured range from Rs 50,000 to Rs 5 lakhs (in multiples of Rs 50,000). Corona Rakshak policy offers a lump sum payout in case of hospitalisation as per the policy terms and conditions. The coverage amount ranges from Rs 50,000 to Rs 2.5 lakh (in multiples of Rs 50,000).