The Insurance Regulatory and Development Authority of India (IRDAI) has clarified that it permitted insurers to change base premiums up to 5 per cent to comply with standardisation and exclusions.
The clarification comes after reports that several insurers hiked the premiums by exorbitant margins, in some cases above 30 per cent, after the regulator asked companies to widen coverage and standardise exclusions.
On December 3, IRDAI said it had allowed changing the base premium only up to 5 per cent of the current premium rates as a onetime measure. It was for seamless transition of existing products to ensure viability and sustainability.
Advertisement
IRDAI said that premiums were increased by general and health insurers up to 5 per only for 55 products out of 388 products.
The regulator also said that it had cleared revision in premium beyond 5 per cent for only five health insurance products till up to November 30, 2020. It was part of a periodical modification of their respective products, based on incurred claims experience.
According to IRDAI regulations, insurers price their health insurance products based on factors like age, risk factors, and the number of family members covered under a policy.
Just one email a week