In a move that will provide comfort to health insurance buyers of longer tenures, the Insurance Regulatory and Development Authority (IRDA) has instructed non-life insurance companies to give 15 days free look period for policies having duration of three years or more.
A free look period of 15 days is already available on all life insurance covers, including health.
Since most health insurance buyers buy annual health covers, the move would not really help said experts.
However, J. Hari Narayan, chairman, IRDA, explained, “The free look period will not be available for one-year policy.
Recently many insurance companies have launched longer tenure health plans. The move will encourage people to buy longer health covers. Slowly the industry will move to three-year policies. Once the industry has adapted, we will introduce free look period for two-year policies and then for one-year policies.”
The new norms will be applicable to all policies issued or renewed on or after October 1, 2009.
IRDA norms stated that the policyholder should be given 15 days from the date of receipt of the policy to review the terms and conditions of the policy.
In case he disagrees to any of the terms and conditions, then he can exercise the option to return the policy, stating the reasons for his objection.
In case the policyholder exercises the free look period and returns the policy, the insurance company should refund the premium paid, after deducting the expenses incurred on medical examination and stamp duty charges.