The Insurance Regulatory and Development Authority of India on 28th April 2022, has published the Draft guidelines on Group Insurance Products under Health Insurance Business and other operational matters to enhance the access of insurance to both formal and informal sectors of the society.
As the primary purpose of any health cover is to meet the treatment costs or to manage the life style on diagnosis of a critical illness, no Insurer is permitted to offer any indemnity or benefit based credit linked group health products, except for coverage of accidental death and disability in respect of policies issued under Personal Accident.
As per the draft guidelines, insurers offering group insurance should have a Board approved group insurance underwriting policy. The policy should specify the manner in which its risk and costs are analyzed and factored into the premium cost. All risk factors per unit of coverage such as individual, family, group floater, etc., should be separately analyzed and priced. Past experience and future exposures should also be critically analyzed for “Large Group”.
The underwriting and the rate review process of the group policies at the time of renewal should consider the member entry and exit patterns from the group in order to address the possibility of adverse selection, moral hazard or fraud.
Further the insurer shall ensure issuance of certificate of insurance (CIS) to the members of the group, who are insured. The certificate of insurance shall include the schedule of benefits, period of cover, the premium paid, the frequency and premium payment term. It should have important terms and conditions including waiting periods, sub limits, deductibles, co-pay and exclusions. It shall also detail the procedure to be followed to register a claim with the insurer including complete details of the insurer where the claim should be registered.
