Regulator unveils guidelines for standard travel insurance policy

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The Insurance Regulatory and Development Authority of India (Irdai) has issued guidelines for a standard travel insurance policy, “Bharat Yatra Suraksha”, which will cover daily trips via all modes of transport such as taxis, buses, trains, ships and planes across India.

The basic policy will cover the costs of hospitalization, death and permanent total disability as well as permanent partial disability due to an accident. Coverage for hospital costs will be in the order of ??1-10 lakh, while the accidental death benefit will be for ??1 lakh to ??1 crore. Optional provisions, or endorsements, include additional coverage for missed flight connections, loss of checked baggage, flight delays beyond three hours, and cancellations.

The Irdai offered five single premium policy options, including a basic plan, for each trip. Thus, policyholders will not be able to opt for renewals. However, one of the options offers a 30-day window to cover return travel.

“In today’s market, there is a plethora of products that have different coverage, add-ons and are mostly structured differently. Standardization of the travel insurance product will provide the policyholder with certainty as to how the insurance policy is administered, interpreted and how claims will be paid. When it comes to making a choice among products already available, a buyer can decide based on brand, price and service experience, ”said Sanjay Datta, underwriting, claims and service manager. of reinsurance, ICICI Lombard General Insurance.

Although the standard travel policy is not mandatory, Irdai urged general insurers and health insurers to launch the product from July 1.

“Although there are a number of travel insurance products in India, each product is distinct and the insurer public may have difficulty choosing an appropriate product. Therefore, a standard travel product is designed with uniform coverage characteristics, so as to meet the most common requirements of a common passenger, ”Irdai said in a circular dated May 5.

Co-payment options, a cost-sharing requirement in which a policyholder bears a specified percentage of the amount of eligible claims, will not be permitted under the Basic Plan. However, insurers can choose to put deductibles – the amount an insured must pay out of their own pocket – before the insurer pays for the policy’s coverage.

The policy will cover the rent of the room, the costs of board and care up to 2% of the sum insured subject to a maximum of ??10,000 per day, and intensive care unit costs have been capped at 4% of sum insured or a maximum of ??20,000 per day. All five policy options will be available depending on distance as well as mode of transportation.

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