Last Updated on October 1, 2023 at 8:28 pm
IRDAI with an aim to ” rationalise and standardize the exclusions in Health Insurance” had released a set of guidelines in Sep 2019. On Feb 10th 2020, they have made an important amendment to these guidelines removing a controversial pre-existing disease clause. A look at why this is controversial and how its removal will benefit buyers.
The guidelines apply to all General and Health Insurers offering indemnity based health insurance (excluding personal accident and Domestic / Overseas Travel) policies offering hospitalisation, domiciliary hospitalisation and day-care treatment.
This standardization in wording removes a big chunk of confusion for at least discerning buyers who bother to read terms and conditions of the policy purchase. Let us first look at the statement removed from the Definition of Pre-Existing Disease (PED)
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email! 🔥Enjoy massive discounts on our robo-advisory tool & courses! 🔥
A condition for which any symptoms and or signs if presented and have resulted within three months of the issuance of the policy in a diagnostic illness or medical condition. (this has now been removed from the definition of a pre-existing disease)
Why is this controversial? Suppose you buy a policy in Feb 2020 and within three months of the policy issue, say April 2020, a routine test reveals that you are diabetic, or have a faulty liver or have cardiac issues etc. There was no indication of this problem when you applied for the policy and therefore no mention of it in the application.
Five years pass without a claim. in May 2025 you get admitted. While taking down your medical history, the doctor mention in the report, “diabetic since April 2020”. For the sake of simplicity let us assume that diabetes is directly related to the cause of hospitalisation.
This is enough reason for the insurer to reject the claim because you had a pre-existing condition diagnosed within three months of the policy issue. This is unfair to policy-holders and thankfully now has been removed.
Definition of Pre-Existing Disease as per Guidelines on Standardization of Exclusions in Health Insurance Contracts
Reference: IRDAI/HLT/REG/CIR/046/02/2020
Pre-existing Disease means any condition, ailment, injury or disease:
a)That is/are diagnosed by a physician within 48 months prior to the effective date of the policy issued by the insurer or its reinstatement (Feb 2020 circular includes reinstatement term and clarifies date of policy issue) or
b) For which medical advice or treatment was recommended by, or received from, a physician within 48 months prior to the effective date of the policy issued by the insurer or its reinstatement
(Life Insurers may define norms for applicability of PED at Reinstatement)
Other changes made in the guidelines
1. For “life-threatening situations following an accident” treated in a hospital excluded specifically by the insurer, “expenses up to the stage of stabilization are payable but not the complete claim”.
This has now been modified to “life-threatening situations or following an accident” That is, an emergency admission can be done in a hospital excluded from coverage regardless of whether it was caused by an accident or not.
2. The term “birth control” has been removed from “exclusions Q: Birth control, Sterility and Infertility”. This is not expected to have a positive or negative impact on both the insured and insurer!!
🔥Enjoy massive discounts on our courses, robo-advisory tool and exclusive investor circle! 🔥& join our community of 5000+ users!
Use our Robo-advisory Tool for a start-to-finish financial plan! ⇐ More than 1,000 investors and advisors use this!
New Tool! => Track your mutual funds and stock investments with this Google Sheet!
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Have a question? Subscribe to our newsletter with the form below.
- Hit 'reply' to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email!
Explore the site! Search among our 2000+ articles for information and insight!
About The Author
Dr. M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter, Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course! Increase your income by getting people to pay for your skills! ⇐ More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts you and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!
Our new book for kids: “Chinchu gets a superpower!” is now available!
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook is for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or get the Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & it's content policy. Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
- Twitter @freefincal
- Subscribe to our YouTube Videos
- Posts feed via Feedburner.
Our publications
You Can Be Rich Too with Goal-Based Investing
Published by CNBC TV18, this book is meant to help you ask the right questions and seek the correct answers, and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now.Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want
This book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at a low cost! Get it or gift it to a young earner.Your Ultimate Guide to Travel
This is an in-depth dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, and how travelling slowly is better financially and psychologically, with links to the web pages and hand-holding at every step. Get the pdf for Rs 300 (instant download)