Irdai allows renewal, portability of Covid-specific products
The Insurance Regulatory and Development Authority of India (Irdai) has allowed renewability, portability and migration of standard Covid-specific products — Corona Kavach and Corona Rakshak. Market participants say this move will bring in more clarity and help policyholders get the specific coverage for the novel coronavirus.
Irdai in its circular said Corona Kavach and Corona Rakshak may be renewed for further terms of 3.5 months, 6.5 months, and 9.5 months as per the option exercised by the policyholder. Renewals may be done before the expiry of the existing policy contract. More importantly, where policy is renewed, additional waiting period of 15 days shall not be imposed and the coverage shall be continued seamlessly.
The regulator has also said during the 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. Both these policies are permitted to be renewed till March 31, 2021.
The regulator had allowed insurance companies to come out with Corona Kavach, which is an indemnity plan and covers all the hospitalisation expenses that arise from novel coronavirus. It ensures that hospitalisation expenses are covered up to the sum insured. The sum insured in Corona Kavach policy ranges from Rs 50,000 to Rs 5 lakh.
Corona Rakshak is a fixed benefit plan. In this case, if the policyholder is diagnosed with Covid-19 and hospitalised for three days, a fixed amount (which is sum insured) will be paid by insurance companies. The sum insured in this policy is Rs 50,000 to Rs 2.5 lakh.
At the time of launch, it was specified that lifelong renewability, migration and portability are not applicable to these products.
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. Irdai also said general and health insurers are permitted to allow portability of Corona Kavach (individual) policy from one insurer to another.
Source : Financial Express