Should you look at a regular, comprehensive health cover instead?
Digital-only general insurer Digit has rolled out Health Care Plus, a fixed-benefit health insurance policy designed specifically to cover the Coronavirus Disease, or COVID-19, the contagious epidemic that has unleashed paranoia across the world. The timing of the launch coincided with the wave of panic that spread across India on Tuesday. The total number of confirmed cases in India as on Wednesday now stands at 29, including 15 Italian tourists who tested positive for the disease. Another large private general insurer is also expected to launch a COVID-19-specific product, but it is likely to be an indemnity-based cover. More products could be in the offing. “For the purpose of meeting health insurance requirements of various sections, insurers are advised to design products covering the costs of treatment for Corona Virus,” the Insurance Regulatory and Development Authority of India (IRDAI) said on Wednesday.
Health Care Plus, which will be offered under IRDAI’s regulatory sandbox framework, offers sums insured of between Rs 25,000 and Rs 2 lakh. Under this framework, insurers can sell innovative products that they cannot offer otherwise due to regulatory restrictions – on a pilot basis, for a limited period between February 1 and July 31, 2020. This product will be available for sale up to July 31, 2020, while the tenure is one year. The maximum age at entry is 75 years. The premiums start at Rs 299 at the lower end, while the maximum sum insured entails a premium of Rs 2027, plus GST, as posted on Policybazaar.com.
If policyholders test positive for COVID-19 at any of the authorised centres of ICMR-National Institute of Virology, Pune, the company will pay out the entire sum insured. If only quarantine is advised in a government or military hospital due to symptoms or contact with infected persons, Digit will hand out 50 per cent of the claim amount. This would be applicable even if the individual tests negative later. “Regular indemnity-based policies will not come into play when the governments take care of the treatment, which is usually the case when it comes such communicable diseases that necessitate special kind of infrastructure. So, Health Care Plus works well as complementary policy. The claim amount will come in handy to compensate for any loss in income during the period of treatment or quarantine,” explains Vivek Chaturvedi, Head, Marketing and Direct (online) sales, Digit Insurance.
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.
Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
Being a fixed-benefit policy, it will pay out claims even if the government has taken care of your expenses or you have filed a claim under your regular, indemnity-based health insurance policy. Claim will be paid out once the policyholder submits a certificate from a government medical officer to commence COVID-19 treatment or produces a positive virology report from the National Institute of Virology, Pune.
However, it will not be extended to individuals or their family members if they have travelled to certain countries, including China and Japan. It will also not be issued to individuals with symptoms such as cough (with or without sputum), cold or nasal block, fever with body pain or shortness of breath for up to six weeks preceding policy purchase. “Insurance works on the principle of utmost faith. The policyholders will have to give a self-declaration certifying that they do not have such symptoms,” says Chaturvedi.
The cover comes with a waiting period of 15 days – that is, if you contract the disease during this period, claims will not be payable. “The incubation period for the virus is 14 days. Thus, this waiting period clause will reduce the scope for disputes,” says Chaturvedi.
Since Digit Health Care Plus is a fixed benefit policy, it will hand out the promised amount upon diagnosis of COVID-19 even if the government has already taken care of your treatment expenses. The policyholder can use the sum for recuperation post discharge as also to make good the loss of income during the treatment period. Documentation will be minimal and claim settlement relatively hassle-free. It reduces the scope for disputes around partial claim payment on account room rent sub-limits, pre-existing diseases, non-medical items and so on.
There is a long list of restrictions, starting with the criterion for issuing the policy. If you or your immediate family members have travelled to China, Japan, Singapore, Thailand, Malaysia, Hong Kong, Macau, Italy, Iran, Bahrain, Kuwait and Taiwan since December 1, 2019, you will not be eligible. Health Care Plus, having been filed under IRDAI’s regulatory sandbox framework, is a limited-period product. Unlike regular health policies, which can ordinarily be renewed every year for lifetime, it will cease to exist once the entire sum insured is paid out or at the end of its one-year tenure. Moreover, its exclusivity (or USP) – cover for COVID-19 – is also its limitation. Policyholders can secure a policy with a larger and wider coverage if they can shell out extra sums.
Moneycontrol's takeIf you are paranoid about COVID-19 and not covered by any form of health insurance – neither group not independent – might find this product useful. However, at present, world over, it’s the governments that are controlling the screening, quarantine and treatment processes. The expenses are borne by the authorities, which means that the disease is unlikely to burn a big hole in your pocket, should you be affected. This apart, you would be better off buying an adequate, comprehensive, regular health insurance cover instead. If you can afford a premium Rs 2,027 for a Rs 2-lakh policy that is valid only for a year, you might as well shell out another Rs 2,358 for double the cover that will also be renewable for life. Regular health policies will not only cover COVID-19, but also a wide range of ailments, barring the pre-existing ones. The IRDAI, on its part, has directed insurers to expeditiously process COVID-19-related claims in cases of hospitalisation, which is likely to make the process simpler for policyholders who have regular policies.