HIV/AIDS patients not to be denied insurance cover: Irda

They will, however, have to pay higher premium

Those suffering from HIV-AIDS or other illness wouldn’t be denied life insurance cover, though they might have to pay a higher premium, the Insurance Regulatory and Development Authority (Irda) said on Friday.

Irda Chairman T S Vijayan said insurance companies would provide life cover to those with pre-existing illness, but the pricing will be based on commercial considerations. “The whole idea is the person may be having a disease once the policy has started. Even if the person is having disease, he shouldn’t be excluded. The obvious thing is pricing has to be different. That is a commercial decision left to the industry,” he told reporters on the sidelines of an event organised by the Federation of Indian Chambers of Commerce and Industry here.

Vijayan said a few insurers had already introduced cover for HIV-AIDS-infected patients. “I am sure more companies will bring in policies,” he said.

In October, Irda had brought out a draft circular, asking all insurers to provide life insurance cover to HIV-AIDS patients. The circular on policies for people with HIV-AIDS is likely come into effect from April 2014. Before that, insurers will be required to put in place procedures for underwriting, claim settlements and proposal forms.

The circular also provides for health insurance products offered by life insurers for those who are infected by HIV-AIDS after the commencement of an insurance policy. It states insurers should not reject any claim on such grounds, adding for all such cases, the underwriting and claims settlement guidelines applicable during the commencement of the policy should be applicable.

On differential pricing of group and individual insurance products, Vijayan said group pricing would always have a discount over individual pricing.

“When a group is presented before an insurer, the group absorbs lot of administrative hassles …The insurer gets an advantage on costing when it is looking at a group, rather than an individual,” he said.

On the Reserve Bank of India (RBI)’s draft guidelines on banks acting as brokers for insurance companies, Vijayan said feedback on the draft was to be given by December. “Then, we will see what is moving forward.”

Many have expressed apprehension as the RBI guidelines have stringent capital requirements, not many lenders may come forward for insurance broking.