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17 August, 2019 22:58 IST
Should the coverage criteria for pre-existing diseases be reviewed?
Source: IRIS | 29 Jun, 2015, 01.28PM
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  With the growing awareness levels with respect to the importance of health insurance coverage, a large number of people from different walks of life are reaching out to health insurance companies. This is especially true when it comes to metropolitan cities and urban areas. The semi-urban and countryside areas are still far behind and most people are not even aware of such kind of facility available at their disposal.

Nevertheless, it is great that the awareness levels are going up. At the same time, there are many issues which people face when they plan to get health insurance coverage for themselves. Coverage of pre-existing diseases or health conditions is one of the major ones amongst those issues.

What is meant by pre-existing diseases?

As a matter of fact, you cannot get mediclaim policy coverage towards a disease which has already been detected, before taking the plan. For insurance companies, it is a business. Providing health insurance coverage to an already sick person is a loss making proposition.

Insurance companies prefer to keep a strict control on their claim settlement amounts in order to secure revenues and make profits. Providing coverage to pre-existing diseases can wipe out their revenues collected through the way of premium from different customers.

Let's take an example. Suppose that Mr A wishes to have health insurance coverage but he is already suffering from high blood pressure. His health condition indicates that his probability of falling sick is much higher than others. In this case, the health insurance company will try to stay away from providing him coverage.

It is apparently clear that the amount of premium paid towards a mediclaim plan is much less than the coverage amount. It is almost 10-20 times higher than the premium amount. This differential amount is pooled through premium amount of other people, and thus for an insurance company, it is necessary to have health insurance policy holders who are healthy and do not raise claim.

Is there a way out?

Well, certainly there are several restrictions and reservations pertaining to pre-existing health conditions. But that is not the end of the world! There is a way out.

Most health insurance companies keep a certain period under which they do not cover pre-existing conditions. Once this period is over, you can expect full coverage. The premium charged by the service provider will be definitely higher and you have to bear it for a reason.

There is no one standard policy regarding exclusion period towards pre-existing health conditions. It could range from a few months to more than a year. Different companies have different policies. Also, you should be aware that there is a provision of riders. If you avail of these riders by paying the extra amount, you can claim coverage against pre-existing diseases.

Furthermore, there are specific health plans which cover conditions and issues such as diabetes, blood pressure, etc. The premium amount is ascertained accordingly and the patients never face issues related to rejection of claims on the grounds of non-revelation of pre-existing diseases etc.

With the ongoing reforms in the insurance sector in India, there is dire need to standardise policies related to coverage of pre-existing diseases. The Insurance Regulatory and Development Authority of India (IRDAI) is playing a pivotal role in taking the sector to the next level and it is expected that this concern will also be addressed sooner than later.

(Contributed by Naval Goel, Founder & CEO,

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