What is The Role of the IRDAI When It Comes to Health Insurance in India

Posted on: Jun 6, 2025 | 3 mins | Written by: HDFC ERGO Team

What is The Role of the IRDAI When It Comes to Health Insurance in India

What is The Role of the IRDIA When It Comes to Health Insurance in India

When you buy a health insurance policy in India, whether offline or online, there’s one regulatory body that ensures everything functions smoothly – the Insurance Regulatory and Development Authority of India (IRDAI). As a policyholder, it is essential for you to understand the IRDAI’s role because this organisation ensures your rights are protected and insurers maintain ethical practices.

What is IRDAI?

IRDAI is a statutory body formed under the Insurance Regulatory and Development Authority Act, 1999. It operates under the Ministry of Finance and is responsible for regulating and promoting insurance and reinsurance industries in India. Its goal is to protect policyholders’ interests while ensuring the financial stability of insurance companies.

Key Functions of IRDAI in Health Insurance

Here are the major responsibilities of IRDAI when it comes to health insurance:

1. Regulation of Insurance Companies

IRDAI provides licences to insurance companies and monitors their functioning. It ensures that these companies follow ethical practices and maintain solvency margins so they can pay claims without defaulting.

2. Standardisation of Health Insurance Policies

To avoid confusion and promote transparency, the IRDAI has introduced standardised products such as the Arogya Sanjeevani Policy. These plans offer uniform features across insurers, making it easier for you to compare options and make informed choices.

3. Premium Regulation and Transparency

While IRDAI doesn’t directly fix premiums, it ensures that premium calculation is fair and transparent. It mandates insurers to clearly disclose premium rates and loading charges.

4. Protection of Policyholder Interests

One of IRDAI’s core mandates is to protect the interests of policyholders. It ensures:

• Fair terms and conditions

• Transparent policy wordings

• Timely issuance and renewal of policies

• Non-discriminatory pricing

5. Grievance Redressal Mechanisms

IRDAI has set up the Integrated Grievance Management System (IGMS), where you can lodge complaints against your insurer. The system allows tracking of complaint status and escalates unresolved issues to the IRDAI.

6. Regulation of Intermediaries

IRDAI also regulates intermediaries such as agents and brokers. It sets guidelines for their conduct, training and licensing. This ensures that they provide correct information and do not mis-sell policies.

7. Health Insurance Portability

Health insurance portability allows continuity of coverage when you are dissatisfied with your current insurer.

IRDAI Guidelines That Affect Your Health Insurance

Let’s look at some notable IRDAI guidelines that directly impact you:

• Standard Waiting Periods

IRDAI has regulated the waiting periods for pre-existing diseases. Most policies now follow a 3-4 year waiting period for pre-existing conditions, ensuring consistency across insurers.

• Lifetime Renewability

IRDAI mandates lifetime renewability of health insurance policies. This is especially beneficial for senior citizens.

• Coverage for Modern Treatments

Recent IRDAI circulars have directed insurers to cover modern treatment methods such as robotic surgeries, oral chemotherapy, and daycare procedures.

• Mandatory Disclosure of Network Hospitals

Insurers are required to disclose their list of network hospitals so that you can make informed decisions about where to get treatment.

IRDAI and Technology in Health Insurance

IRDAI encourages the use of technology to enhance the insurance experience. Here’s how:

• Online policy issuance and renewals:

It ensures smooth processing of online health insurance policy applications.

• E-insurance accounts:

Encouraged by IRDAI to manage policies digitally.

• Digital grievance redressal:

The IGMS platform is accessible online, ensuring faster resolution.

How IRDAI Ensures Claim Settlement Transparency

IRDAI mandates insurers to:

• Set up dedicated claims teams

• Provide a claims handbook with step-by-step instructions

• Set specific timelines for approvals and reimbursements

Things to Keep in Mind When Buying Health Insurance

Before buying a policy, make sure to:

• Read the IRDAI-approved policy wording carefully

• Choose insurers with a high claim settlement ratio

• Check if your preferred hospitals are in the insurer’s network

• Understand all inclusions and exclusions

When purchasing an online health insurance policy, use only authorised platforms and verify that the insurer is IRDAI-registered.

Conclusion

The IRDAI is the backbone of India’s health insurance sector. From policy design to claims handling, its influence ensures fairness, transparency and protection. As a policyholder, knowing the role of IRDAI empowers you to make better decisions and assert your rights. Whether you are purchasing a new plan or renewing an existing online health insurance policy, IRDAI’s regulations work silently in the background to safeguard your interests.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

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