The Insurance Regulatory and Development Authority of India (IRDAI) has come up with a string of changes which will ensure the mandatory offering of the Arogya Sanjeevani policy, with sum insured between Rs 50,000 and Rs 10 lakh, come May 1st.
As of July 2020, the IRDAI had given the insurers a free hand with regard to the sum insured, allowing them to come up with options tailored to meet their respective needs. It had gone as far as to remove the upper limit for the sum insured. However, the IRDAI has recently retraced its step, bringing back restrictions and capping the maximum sum insured limit at Rs 10 lakh.
This move can be seen as an act by the regulator to make the policy more attractive to all sections of the society with its multiple options. The Arogya Sanjeevani policy was designed by the IRDAI and made available across all insurers. It is meant to be a standard policy that is understood by the common man and is universally covered by all insurers.
The move also comes at a time when the country has been hit by the second wave of the COVID-19. Apart from the risk to our health, the pandemic also poses a serious financial risk as it threatens to drain away our savings and disrupt financial plans. The Arogya Sanjeevani policy can play a crucial role in limiting the damage to personal finances.
Mahavir Chopra, CEO of Beshak.org, an awareness platform for insurance buyers, said that the move by the IRDAI was to ensure wider coverage options that would make the policy more feasible for different social strata – a wider limit between Rs 50,000 and Rs 10 lakh instead of Rs 1 lakh to Rs 5 lakh.
Director of FinSafe.in, Mrin Agarwal also said that hiking the maximum sum insured of the policy was a good move as it will enable the policy holder to keep up with the rising medical costs in Tier-1 cities. Arogya Sanjeevani is well-suited for the first-time insurance buyer or someone who is merely looking for a standard health cover across the board with clearly defined limits. It is a good introduction to the insurance world as it will allow for the evaluation and the adoption of other polices in the future.