India: Standardised Health Product For The Indian Insurance Market

Last Updated: 3 May 2019
Article by Celia Jenkins, Anuj Bahukhandi and Swathi Ramakrishnan


The health insurance market has a wide variety of significantly different health insurance products available today, often leading prospective customers to choose from a large number of products embedded with varying benefits and exclusions with limited options to choose only those covers are actually needed by such a customer. Due to the lack of standard medical solutions in the insurance industry, it was considered necessary by the IRDAI that potential customers have access to a basic health insurance product in order to avail coverage under a health insurance policy based on their requirements. In order to enable prospective customers to avail a basic and standardised health insurance product, the IRDAI recently issued the "Draft Guidelines on Standardization of Individual Health Product" of 19th February 2019 ("Draft Guidelines").

The Draft Guidelines propose a standard individual health insurance product offering a fixed set of covers to customers and termed as a 'Standard Mediclaim Policy' ("Mediclaim Policy"). Every General and Health Insurer will be mandatorily required to offer the Mediclaim Policy, in accordance with the directions issued by the IRDAI in this regard. 

Key Highlights

The Draft Guidelines propose the following specifications for the Mediclaim Policy:

  1. Construct of the Mediclaim Policy: The terms and conditions of the Mediclaim Policy are proposed to be divided into the following parts:
    1. Part I: Policy Schedule - The Policy Schedule shall set out the specific terms of the insurance cover available to the Insured and specify the Sum Insured limits for the covers offered under the Mediclaim Policy;
    2. Part II: Definitions - The definitions applicable to the Mediclaim Policy shall be incorporated in this part. Further, wherever applicable, the definitions shall be in compliance with the standard definitions stipulated under the "Guidelines on Standardization in Health Insurance" of 29th July 2016;
    3. Part III: Benefit Design - The Mediclaim Policy shall be clear and specific in setting out the base benefits available under the Mediclaim Policy and the applicable terms and conditions;
    4. Part IV: Exclusions – The exclusions applicable to the cover under Mediclaim Policy shall be subject to the guidance issued by IRDAI from time to time in this regard; and
    5. Part V: Other terms and conditions - All other applicable terms and conditions shall be incorporated in this part.
  2. Base Covers: The Mediclaim Policy shall mandatorily cover the following "Base Covers" invariably subject to sub-limits, if any, and no additional add-ons, deductibles, optional covers or variants shall be offered with the Mediclaim Policy:
    1. Hospitalization Expenses: Expenses incurred on, including but not limited to room rent, nursing expenses, cataract, plastic surgery, domiciliary hospitalization;
    2. AYUSH Treatment: Expenses incurred on treatment under Ayurveda, Unani, Sidha and Homeopathy system of medicines;
    3. Pre-Hospitalization: Expenses incurred for a period not less than 30 days prior to the date of hospitalization;
    4. Post Hospitalization: Expenses incurred for a period not less than 60 days from the date of discharge towards consultant fees, diagnostic charges and medicines and drugs;
    5. Wellness Incentives: Insurers shall provide access to health consultations for obtaining periodic consultations at least once in a policy year, access to professional medical services, including follow up care, parametric indices and reward mechanisms to incentivize policyholders, and outpatient consultations or treatments to policyholders.
  3. Family Floater Policy: The Mediclaim Policy shall be offered on family floater basis as well.
  4. Category of Cover: The Mediclaim Policy shall be offered as a standalone product only on indemnity basis, and shall not be combined with any critical illness covers or benefit based covers available.
  5. Pricing: Insurers are allowed to formulate differential pricing mechanism in order to incentivize early entry of prospective policyholders, continued renewals and favourable claims experience.
  6. Distribution Channel: The Mediclaim Policy may be offered across all distribution channels including, through micro insurance agents, point of sales persons and common service centres.
  7. Micro Insurance Product: The Mediclaim Policy may be offered as a micro insurance product subject to the sum insured limits specified in the IRDAI (Micro Insurance) Regulations 2015, and other applicable circulars and guidelines issued by the IRDAI in this regard.
  8. Basic Sum Insured: The minimum sum insured under the Mediclaim Policy shall be Rs.50,000, and policyholders may insure up to a maximum limit of Rs.1,000,000.
  9. Cumulative Bonus: The sum insured shall be increased by 5% per policy year, up to 50% of the Sum Insured provided that no claims have been made under the policy period, and that the Mediclaim Policy is continuously renewed without any break.
  10. Co-payment: The IRDAI has currently mandated 5% of co-pay to form a part of the Mediclaim Policy feature, whereby the policyholder will be liable to pay 5% of the total claim amount.
  11. Entry Age: The minimum age for entry of the principal insured shall be 18 years and the maximum age for entry shall be 65 years, along with lifelong renewability. In case of a dependent child, the Mediclaim Policy shall cover from 0 days to 25 years. However, the policy shall have no maximum exit age.
  12. File & Use Application: The File & Use application (Form – IRDAI – FnU – HIP) shall clearly disclose the benefit pay out structure, the co-pay terms, non-medical limit and all other relevant details in the application.
  13. Nomenclature: The name of the Mediclaim Policy shall be succeeded by the name of the Insurer issuing it, and no other name is permitted to be used on the relevant policy documents.

In addition, the underwriting of the Mediclaim Policy, and the applicable terms and conditions such as the free look period, policy period, modes of premium payment, grace period, renewal, premium loading and discounts and portability shall be in compliance with provisions of the IRDAI (Health Insurance) Regulations 2016, "Guidelines on Standardization in Health Insurance" of 29th July 2016 and the "Guidelines on Product Filing in Health Insurance Business" 29th July 2016, as amended from time to time. 

Concluding Remarks

The Draft Guidelines appear to be aimed at regulating and promoting the orderly growth of the health insurance market in India and furthering the interests of the policyholders. While the Draft Guidelines stipulate the standard covers to be offered under the Mediclaim Policy, the specific extent of coverage, sub-limits, and other modalities under these base covers have not been expressly stipulated and offer Insurers certain flexibility to that extent.

The IRDAI has also allowed Insurers to determine the pricing of the product in accordance with its own underwriting experience and standards which appears to have been largely welcomed by Insurers. Further, the Indian insurance industry has also hailed the induction of such a standardised product, due to which the porting process of the Mediclaim Policy is expected to become fairly easy and smooth.

The IRDAI has invited comments and suggestions on the Draft Guidelines from all stakeholders. It remains to be seen how the Mediclaim Policy will be priced by General and Health Insurers, and how the product will be received by customers and implemented going forward.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions