1 January

Insurers to cover mental illness: IRDAI

Category: Moter insurance

In a communiqué to insurers on August 16, 2018, the Insurance Regulatory and Development Authority of India asked the insurers to cover mental illness in their insurance policies and treat the disorder at par with physical illness. 

It asked the insurers to make provisions for medical insurance for treatment of mental illness with immediate effect. Indian insurers today exclude mental illness from their policy, however in the global scenario, companies provide policy cover for mental illness o=after a waiting period of 2-3 years.

The Irdai’s directive follows the Mental Healthcare Act, 2017 which has come into force from May 29, 2018. “As per Sec 21(4) of the said Act, every insurer shall make provision for medical insurance for treatment of mental illness on the same basis as is available for treatment of physical illness,” said Irdai. 

It shall include analysis, diagnosis, treatment as well as rehabilitation according to Mental HealthCare Act 2017.

The said policy will allow the people with such ailments to live a life of dignity, along with creating awareness, acceptance and inclusion in the society. It will also help remove the financial and social stigma attached for the care takers/parents as well as the affected. This will also help bust many myths and normalize the diagnoses. 

Insurers are looking at IRDAI for the definition of mental illness, which is a wide term. As per the Ministry of Law and Justice, mental illness is defined as substantial disorder of thinking, mood, perception, orientation or memory that grossly impairs judgment, behavior, and capacity to recognize reality or ability to meet the ordinary demands of life. Also, mental conditions are often associated with the abuse of alcohol and drugs, but do not include mental retardation which is a condition of arrested/slowed or incomplete development of mind of a person, specially characterized by sub normality of IQ. 

Premiums will have to be revised and the terms redefine, companies have always excluded not going the claims that can arise out of it.


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