How This New Health Insurance Rule Can Save Your Time and Money?

Since January 1, 2024, buying or renewing a health insurance policy has gotten much simpler for Indian consumers. In a landmark policy directive, the Insurance Regulatory and Development Authority of India (IRDAI) has mandated all general and health insurance providers to issue a standardised Customer Information Sheet (CIS) to customers.

This 2-3-page CIS document written in simple language will capture all key details regarding the policy on offer. The provision is based on the regulatory principle of utmost good faith and aims to promote transparency for policyholders. 

Let’s understand the new health insurance rules in-depth, along with its benefits.

The Need For Standardised CIS In Health Insurance

Historically, health plans in India have been renowned for complex exclusions and technicalities that keep customers unaware of complete coverage terms. Varying policy wordings and clauses often led to disputes during claim settlement. 

To eliminate information asymmetry between insurers and the insured, IRDAI first introduced the concept of a CIS in 2017 across life, non-life, and standalone health insurance products. However, a lack of standardisation hindered transparency.

The latest circular aims to develop a uniform CIS format exclusively for retail health policies sold by general and health insurance companies. This will encapsulate all key aspects into a simple, standardised document, highlighting the following: 

• Key benefits and exclusions 

• Claims process 

• Rights and responsibilities 

By serving as an acknowledgement document summarising policy features, the CIS will prevent future disputes due to a lack of transparency. 

It will also enable easier comparison across health plans while buying or porting policies. 

Core Elements Captured Under the CIS

As per IRDAI guidelines, the CIS needs to be issued in the policyholder’s preferred language and include the following details:

• Product name, UIN number, policy term, sum insured, and cumulative bonus. 

• Key health insurance benefits are covered, e.g., hospitalisation, pre- and post-care, and AYUSH treatment.

• List of permanent exclusions like suicide, cosmetic surgery, alcohol abuse, etc. 

• Co-payment clauses, sub-limits if applicable.

• Claims intimation process, document list, TAT for settlement.

• Obligations of the insurer and policyholder. 

• Contact details for disputes and consumer grievance redressal.

• Besides simplifying policy comparisons, the CIS will ensure customers make informed purchasing decisions aligned to their needs. 

Digitization Of CIS Delivery Via Repository

As part of the reforms, the issuance and delivery of CIS will be done digitally by insurance repositories regulated by IRDAI. 

Policy buyers can access and also download standardised CIS in real-time through the repository’s web portal or mobile app as insurers integrate with the digital system.

This will automate the storage of CIS documents, giving customers hassle-free access to their policy information at any time, even if they switch insurers in the future. 

The move accelerates India’s adoption of e-documentation in the insurance sector.

Benefits Of Standardised CIS Forms 

The mandatory standardised CIS forms for health insurance aim to provide the following benefits: 

• Aid easy comprehension of covers and exclusions by policyholders

• Eliminate a lack of transparency about claim settlements.

• Curb mis-spelling of products unable to serve needs 

• Simplify comparisons across health plans. 

• Increase trust and insurers’ accountability.

• By serving as the single point of reference, CIS will give customers greater clarity on policy details and rights as insured citizens. 

• This furthers the insurance regulator’s consumer protection mandate.

Way Forward

The CIS guidelines help move towards a more transparent and efficient way of working to help the insurers better understand the complete framework of the insurance they are going to undertake. 

This also provides them with a tool to compare and contrast to choose the best policy and plan available to them. The CIS guideline will further encourage people to seek out insurance policies, as they have been simplified and made more accessible than before.

To know more visit Customer Information Sheet - IRDAI. You can also email at irda@irdai.gov.in or call 4020204000 or 4039328000 directly.