You are here: Home » Finance » News » Insurance
Business Standard

Irda to bring out proposal for life cover to differently abled

Currently, there are no definitive guidelines defining the cover for people with disability

M Saraswathy  |  Mumbai 

Insurance

Regulatory and Development Authority (Irda) is looking to bring out a proposal for providing life cover for the diferently abled. While disability is not explicitly excluded from life policies, there are no definitive guidelines defining the cover for such individuals.

“The proposal is at a discussion stage at the actuarial department. We will soon bring out a discussion paper on this,” said a senior Irda official. This proposal will first be presented as a paper to life insurers for their feedback and then, detailed guidelines would be formulated.

At present, disability insurance is provided under personal accident policies by general insurance companies. Here, the policy provides for income replacement if the policyholder gets physically injured in any accident leading to loss of income for the family. Disability is also covered by life insurance companies, wherein a cover is provided for accidental disability. These products are offered both, as a policy and as a rider with an insurance plan. If anything happens to the insured during the policy tenure, the insurance company pays him/her a lump-sum amount. However, this does not provide any protection for disabilities existing from one's birth or early childhood.

Insurance sector officials said that there, the regulator would clearly define what is disability, the types of disability-permanent or ongoing. The various ailments are also expected to be classified either as static and permanent, which would include polio and physical disability like loss of sight at birth, loss of hand/leg at birth among others. Other types of ongoing ailments like severe Hepatitis B, cancer of the last stages and severe damage to the lungs or heart would be put into a separate category.

“While permanent and static disability is expected to be included as the category that would be covered by life insurance, progressive and critical stages of ailments are likely to be excluded from coverage. This is because such ailments are very risky to be covered, from an insurance perspective,” said a senior life insurance official.

Officials close to this development said that at a future stage, when there is adequate data and research on these ailments, such patients could be provided life insurance cover, albeit at a higher premium.

Not all types of cancer are excluded from life insurance coverage. While patients in the last stages of such life-threatening diseases are excluded from life insurance coverage, others at an early stage are not denied a cover. These patients usually pay 30-40 per cent higher premium than regular policyholders, due to the higher risk involved in their coverage.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sat, January 04 2014. 00:32 IST
RECOMMENDED FOR YOU
.