The Insurance Regulatory and Development Authority of India (IRDAI) is setting new standards for health insurance, mandating quicker and more efficient claim settlements to benefit policyholders. Effective immediately, insurers must make decisions on cashless authorization requests within one hour and finalize discharge authorizations within three hours of receiving the necessary requests from hospitals. This directive aims to streamline the claims process, ensuring policyholders aren’t delayed during medical emergencies.
Under these new rules, insurers are encouraged to achieve 100% cashless claim settlements, reducing the need for reimbursements to only exceptional circumstances. To facilitate this, insurers should establish dedicated help desks at hospitals to assist with cashless requests. They are also required to provide pre-authorization to policyholders through digital channels. The IRDAI has set a deadline of July 31, 2024, for insurers to implement the necessary systems and procedures to fully comply with these new mandates.
To ensure fair claim settlements, the IRDAI has mandated that no claim should be rejected without approval from the Policyholders’ Management Committee (PMC) or a three-member sub-group known as the Claims Review Committee (CRC). If a claim is denied or partially disallowed, the claimant must receive a detailed written explanation referencing the specific policy terms and conditions. Insurers and Third-Party Administrators (TPAs) are now responsible for collecting required documents from hospitals, relieving policyholders of this burden.
IRDAI’s master circular also addresses scenarios where policyholders have multiple health insurance policies, allowing them to choose under which policy they wish to claim. The primary insurer is then responsible for coordinating with other insurers to settle any remaining balance. In cases of policy cancellation during the term, policyholders may also receive a refund of the premium or a proportionate premium for the unexpired policy period.
These changes reflect IRDAI’s commitment to enhancing policy transparency, improving customer satisfaction, and ensuring timely claim settlements. By setting clear timelines and streamlining processes, IRDAI is working to build trust between insurers and consumers, fostering a more reliable healthcare financing system. The implementation of these norms will require coordination and adjustment across multiple stakeholders, including insurers, hospitals, and TPAs.
