Irda & #39;S 1% Fee To Up Mediclaim Cost

Mediclaim policies will come dearer as third party administrators (TPAs) will have pay 1 per cent fee on their income to the Insurance Regulatory and Development Authority (Irda).

The fee is over and above the Rs 20,000 license fee imposed on TPAs. The clause is part of the final TPA regulations, which will be notified shortly.

Repeated attempts to contact IRDA officials proved futile. The final regulations further stipulate that remuneration for TPAs will be up to a level of 15 per cent.

This is in keeping with the ceiling on commission paid to other intermediaries such as agents.

By not specifying the minimum remuneration, the Irda had left the fee structure open to negotiations between the insurance company and the TPAs.

Some state insurers had stated that remuneration ought to be capped at 11 per cent, while TPAs were demanding as much as 25 per cent.

Further in the final regulations, the Irda has capped foreign investment in TPAs at 26 per cent.

This is in line with the sovereign policy of ceiling foreign investment participation in the insurance sector at 26 per cent as for insurance companies and brokers as well.

Many TPAs will have to