IRDA asked to relax life cover norms for senior citizens- Insurance news-Insurance-Personal Finance-The Economic Times

IRDA asked to relax life cover norms for senior citizens- Insurance news-Insurance-Personal Finance-The Economic Times: "IRDA asked to relax life cover norms for senior citizens
31 Oct 2009, 0009 hrs IST, Preeti Kulkarni, ET Bureau

MUMBAI: The ministry of social justice and empowerment has asked the insurance regulator to direct non-life companies to relax entry barriers for
senior citizens seeking to buy health insurance and overseas mediclaim policies.

At a recent meeting of the National Council for Older Persons (NCOP), where an IRDA representative was present, IRDA was asked to facilitate health covers for older people. NCOP comes under the ministry of social justice and this meeting was attended by Mukul Wasnik, the Union minister in charge of the portfolio.

Currently, the IRDA guidelines prohibit health insurers from denying fresh mediclaim policies to individuals above 65-year-old. NCOP wants this age limit to be increased. The committee comprises the Union as well as state ministers for social justice and empowerment, senior ministry officials, representatives of state governments and some non-official members.

In addition to health insurance, the committee meeting focused on problems faced by senior citizens over 80-year-old in getting overseas mediclaim insurance, while travelling abroad. At present, many insurance companies are reluctant to provide this cover to senior citizens.

'The council also recommended providing insurance cover to senior citizens travelling overseas, irrespective of their age,' informed Mathew Cherian, chief executive of HelpAge India – an NGO focussed on welfare of the elderly whose representative attended the NCOP meeting.

The council also sought a status update from IRDA on the steps being taken to address the issues relating to senior citizens’ health polices. Widespread complaints from senior citizens on non-renewals and disproportionate hiking of premiums had prompted IRDA to tweak the rules on renewability in March this year.

The insurance regulator had asked insurers to ensure that renewals were not turned down, except on the grounds of fraud, moral hazard or misrepresentation. Furthermore, the companies had been asked to furnish a note explaining the reasons for increasing the premiums and also, how the rise was in line with the charge structure mentioned in the policy’s prospectus.

Another circular issued in May had directed insurance companies to specify in writing the reasons for denying health insurance to senior citizens. “Such reasons should stand scrutiny of reasonableness and fairness,” it stated.

In addition, the insurance regulator had instructed insurers to ensure that the premium charged to senior citizens was ‘fair, justified, transparent and duly disclosed upfront’. Despite IRDA’s measures, however, many senior citizens continue to complain of health insurers rejecting renewal requests and charging unreasonable premiums."