Health Insurance for Senior Citizens: The Need of the Hour
As we age, our bodies become weaker, and the risk of various illnesses increases. For senior citizens, any serious illness can lead to significant financial burdens during treatment. In such circumstances, a good health insurance plan often serves as a lifeline.
Expanding Coverage for Senior Citizens
Great news for senior citizens! As of April 1, 2024, the Insurance Regulatory and Development Authority of India (IRDAI) has removed the age limit for purchasing health insurance. Following this change, individuals aged 65 and above can now buy new health insurance plans. Previously, those over 65 were denied new insurance policies.
According to an order from IRDAI, insurance companies must now create health insurance plans tailored to the specific needs of people of different age groups. This includes special considerations for senior citizens, students, children, and pregnant women.
Additional Regulations for Insurance Companies
IRDAI has introduced additional regulations for insurance companies. Previously, insurance companies offered “indemnity-based” health plans, where they reimbursed the actual hospital expenses incurred. Now, they can only offer “benefit-based” policies, meaning policyholders receive a fixed sum according to the illness. This ensures transparency, allowing policyholders to know in advance how much they will receive for a particular illness. It also enables them to choose better hospitals without worrying about the cost of treatment.
IRDAI aims to ensure that every citizen in the country has health insurance. This not only secures everyone’s financial future but also provides access to better healthcare facilities and services.
New Benefits for Citizens
IRDAI has stated that no insurance company can deny coverage to an individual solely because they have previously suffered from major illnesses like cancer, heart disease, kidney failure, or HIV/AIDS. Moreover, individuals who find it difficult to pay the health insurance premium upfront can now pay in installments.
There’s no limit on Ayush treatment expenses anymore. Ayush includes Ayurveda, Yoga, Naturopathy, Unani, Siddha, and Homeopathy. If your treatment falls under any of these, the insurance company will cover the expenses up to the sum insured. Additionally, with a benefit-based policy, you can claim from multiple insurance companies, providing more options and better services.
Quick Resolution of Complaints
The new rules also ensure quick resolution of complaints and claims for senior citizens. Special channels will be established for them to better understand their needs and provide timely assistance.
Previous Regulations
IRDAI understands the special needs of senior citizens regarding insurance. Therefore, it has been taking steps in this direction over time. In 2006-07, when some insurance companies significantly increased premiums for hospitalization plans, IRDAI set a limit on it. To study the health insurance needs of senior citizens, IRDAI formed a committee, most of whose recommendations have been implemented.
Under the rules, anyone up to the age of 65 should be eligible for a new health insurance policy. If an application for health insurance for a senior citizen is rejected, the reason must be provided in writing. Wherever possible, senior citizens should have the option to change their Third Party Administrator (TPA). A minimum of 50% of the medical examination costs should be borne by the insurance company before taking insurance. Insurance renewal cannot be canceled except in cases of fraud, misrepresentation, or “moral hazard”.
Understanding Premiums
Health insurance experts suggest that the new rules for health insurance for senior citizens are a positive change. Previously, the maximum age was 65, which left many senior citizens without insurance. Now, people of all ages can avail of insurance, making healthcare more accessible. However, experts caution that premiums for the elderly may be slightly higher.
IRDAI’s Health Insurance Regulations of 2016 lay down principles based on which insurance companies determine premiums for their health insurance plans. The most crucial factor affecting premiums is the age of the insured individuals. Besides, other factors such as health condition, occupation, pre-existing diseases, etc., also influence the premium. In some situations, health insurance premiums may increase, but the insurance company must inform you in writing and obtain your consent.
Senior Citizen Population in India
As per Indian law, a senior citizen is defined as an individual who is an Indian citizen and is aged 60 years or above. According to the 2011 Census, approximately 104 million (10.4 crore) people in India are senior citizens, comprising 5.3 crore women and 5.1 crore men. A report by the United Nations Population Fund and HelpAge India estimates that by 2026, the number of senior citizens in India will increase to 17.3 crore.
The population of senior citizens in India and their share in the total population are both increasing. While in 1961, this share was only 5.6% of the total population, it increased to 8.6% in 2011. This figure reached 10.1% in 2021, and it is expected to rise to 13.1% by 2031. The percentage of senior citizens is slightly lower among males compared to females. According to the 2011 Census, 71% of the elderly population resides in rural areas, while only 29% live in urban areas.