IRDAI Reduces the Number of Health Insurance Returns that Insurers can File

Posted on: Dec 2, 2022 | | Written by:

IRDAI Reduces the Number of Health Insurance Returns that Insurers can File

Published on December 01, 2022. EST READ TIME: 4 minutes

An insurance policy is an important product that promises financial security to the insured. During the COVID-19 pandemic, people understood the importance of keepingindividual health insurance, family floater, critical illness insurance and other insurance products handy for such stressful times. The insurance industry saw a notable increase in the number of people buying different policies to safeguard their finances and future. Keeping this in mind, IRDAI has come up with a new rule for insurance companies around the country. As per the new rule, insurers will have to submit fewer returns to IRDAI. The insurance companies in India are mandated to submit various returns to IRDAI or the Insurance Regulatory and Development Authority of India on an annual basis. These include the valuation of assets and liabilities, annual financial statements, solvency margin and accrual reports, among others.In September 2022, IRDAI rationalised health insurance business returns reporting norms in order to ease the compliance burden for insurance companies. Going forward, insurance companies need to file fewer returns annually.

About the New Rule of IRDAI

As per the new rule, IRDAI has significantly reduced the number of returns to be filed by insurance companies in India. According to IRDAI, the move is aimed to make it easier for insurance companies to conduct business.

Before September 2022, the insurance companies in India had to submit various returns in the form of annual financial statements, valuation of assets and liabilities, solvency margin and accrual report to IRDAI. They were also asked to submit reinsurance plans on an annual basis, monthly statements on the underwriting of large risks, and IBNR or Incurred but Not reported claims for general insurance businesses. What’s more, insurance companies had to report the details of capital market exposure every month as well as quarterly and annual returns on investments.

Now, general and health insurance companies will have to file only 8 returns annually. This will ease their work and help them focus on their business rather than meeting a plethora of formalities or compliances. Insurance companies can concentrate on developing the sector further and increasing insurance penetration in the country. The new and revised reporting norms will be applicable with immediate effect.

The insurance sector witnessed huge growth during the COVID-19 pandemic. The pandemic actually reshaped the insurance markets with many people covering themselves and their loved ones under different policies.

The health insurance market witnessed a massive jump during the financial years 2020-21 and 2021-22.The pandemic made people realise the importance of having an adequate health insurance policy handy. A family floater or individual health insurance policy makes it easy for policyholders to opt for the best treatment without worrying about the bills. Policyholders can also avail of cashless treatment facilitiesin the network hospitals. As per reports, the health insurance premium collected in the country grew by 25% during the pandemic.

Hence, the new rule by IRDAI which reduces the number of returns filed by insurers will help insurance companies focus on reaching new customers and serving the existing ones better.

Conclusion

By rationalising health insurance business returns reporting norms, IRDAI has made it easier for insurance companies in India to do their business. Health insurance is an important investment in today’s times. Having an adequate individual health insurance policy or family floater along with critical illness insurance can save policyholders from exorbitant hospital bills. With insurance companies having to file fewer returns going forward, they can concentrate better on providing optimum services to their customers. This will help the insurance industry grow further and make things easier for policyholders as well.

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

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