Irdai cuts maximum waiting period for pre-existing diseases

New Delhi In a major relief to customers buying health insurance policies in 2024-25, the insurance regulator has reduced the maximum waiting period for pre-existing diseases like hypertension, diabetes, thyroid, knee surgeries, from 48 months to 36 months, effective from April 1.
The Insurance Regulatory and Development Authority of India (IRDAI) has reduced the maximum waiting period for pre-existing diseases (PEDs), but there is no bar for insurance firms on the minimum waiting period, said a government official who did not wish to be named.
The waiting period in a health insurance plan is the duration before that certain specific diseases would not be covered by the policy. PED is an ailment a policyholder has before the purchase of a health insurance policy.
Due to the cut-throat competition in the sector, many companies offer health insurance policies with a two-year waiting period or even less for specific diseases. However, IRDAI’s new notification may see a further reduction in the waiting time, experts said.
“Waiting period for pre-existing diseases disclosed by the persons to be insured, shall be maximum up to 36 months of continuous coverage under the Health Insurance policy. Insurers may endeavour to have lesser pre existing disease waiting period and specific waiting period in the health insurance products,” IRDAI said in a notification.
According to the new definition, PED means “any condition, ailment, injury or disease: a) that is/are diagnosed by a physician not more than 36 months prior to the date of commencement of the policy issued by the insurer; or b) for which medical advice or treatment was recommended by, or received from, a physician, not more than 36 months prior to the date of commencement of the policy.”
The specific waiting period up to 36 months from the commencement of a health insurance policy during which specified diseases (except due to an accident) are not covered. On completion of the period, diseases or treatments shall be covered provided the policy has been continuously renewed without any break, it added.
According to experts, the new maximum waiting period for preexisting disease will be applied for all new health insurance policies as well as renewal of existing policies with effect from April 1.
Vivek Iyer, partner at Grant Thornton Bharat, said that the development is part of a larger exercise undertaken by the regulator to make the insurance ecosystem more robust and consumer friendly. “Conduct risk is a big focus area for all the insurance regulators globally and these regulations issued indicate the intent of the Indian insurance regulator to move in the same direction,” he said.
“The objective is also to make the process of coming up with innovative insurance products simpler without any dilution of policyholder interests. The guidelines that have been issued are already being followed by some of the leading insurance players in the market,” he said, adding that such guidelines are part of good practices to raise the overall standard of governance for the insurance ecosystem.