Validity of Covid policies extended till September 30; renewal at same price for survivors

With new variants of COVID-19 coming to the fore, the insurance regulator has extended the renewal period of Covid specific policies, which will now remain valid till September 2021. Last year the Insurance Regulatory and Development Authority of India (IRDAI) directed all insurers to issue short term covid specific insurance plans for individual and families looking out for health insurance covers due to COVID-19.

The two corona-specific products— Corona Kavach and Corona Rakshak — were designed as short term policies for the period ranging from three to nine months. Most of the policyholders went for nine months of coverage.

With the second wave of Covid-19 hitting the country, the regulator has now extended the tenure of these policies. According to estimates, there are around 128 lakh lives that are covered by COVID-specific policies with a total premium of over Rs 1,000 crore. Corona Kavach policy specifically covers hospitalisation expenses for the treatment of Covid-19 while Corona Rakshak is a benefit policy which means a lump sum benefit is payable on a positive diagnosis of Covid-19.

One of the primary concerns has been whether renewals will take place at a higher premium for covid survivors and a longer waiting period. Insurers have, however, said that there will be no increase in health insurance premium and waiting period for covid survivors. “There will be no change in premium and features for people renewing Covid policies. For fresh policies only there will be a waiting period of 15 days. The premium rates have already been filed and it will remain the same,” said Sanjay Datta, Chief – Underwriting, Reinsurance, Claims & Actuarial at ICICI Lombard General Insurance.

Anand Roy, managing director of Star Health agreed. “There is no special waiting period for coronavirus survivors. They will be treated as any other normal customer. As for the policy terms and conditions, there are some waiting periods that will be applicable to them also. For example, pre-existing disease waiting period or some specific treatment waiting periods which are there in most of the insurance policies. The same waiting periods will apply to anybody who has recovered from coronavirus. There is no special waiting period for them.” Star Health Insurance sold close to five lakh covid policies across the country.

Insurers say they also trying to switch customers from Covid-specific to basic policies with much wider coverage. Roy added, “We are proposing to reach out to all these customers and educate them about the importance of renewing their health insurance policy. Probably move from corona coverage policy to a more comprehensive health insurance plan so that they will be covered not only from this particular virus but also for all kinds of medical ailments. We have yet to see the renewals coming up.”