While there is a genuine need to cover mental ailments, there are issues and the existing product structures may not allow it, says insurance company officials
General insurance companies will soon offer health insurance policies to cover treatment of mental illness. Asking insurance companies to comply with the Mental Healthcare Act 2017 with immediate effect, the Insurance Regulatory and Development Authority of India (Irdai) on Thursday, said, "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."
The draft version of the Mental Healthcare Act, issued last year, had asked insurance companies not to discriminate between patients suffering from mental ailments. The act came into force in May 2018. Irdai's guideline is following this.
While there is a genuine need to cover mental ailments, there are issues and the existing product structures may not allow it, said insurance company officials.
According to Nikhil Apte, chief product officer-product factory (health), Royal Sundaram General Insurance, one of the challenge is that a lot of treatment for mental ailments is Out Patient Department treatment. In-patient treatment is in very serious cases. This makes it tough for companies to structure the product. Insurance companies will have to make modifications in existing product features to cover it.
"The need is genuine. But if there is non-disclosure of the disease by the customer, then it could lead to anti-selection. We do underwriting basis age, sum insured and declaration. We take blood, urine sample, electrocardiogram (ECG), etc. But an ailment like schizophrenia will not be evident to the insurer,'' he said.
One way out could be to set sub-limits for such ailments and increase the sub-limits, gradually or offer coverage after a certain number of years, he added.
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