Current policies to be extended to cover mental illnesses as well: Irdai

Insurers say they will have to study the available data to work out by how much premiums will have to go up to be able to cover mental illnesses as well

The Insurance Regulatory and Development Authority of India (Irdai) in a recent circular notified insurers to make provisions, with immediate effect, for the treatment of mental illnesses according to the Mental Healthcare Act, 2017. The notification further clarifies that the treatment for mental illnesses should be on the same basis as the treatment of physical illnesses. Henceforth, people will be able to get coverage for hospitalisation expenses related to mental ailments. It is estimated that about 150 million people suffer from some form of mental disorder in India.

A few months ago, the Delhi High Court had asked IRDAI to relook the exclusionary clause in insurance contracts related to genetic disorders, and ensure that insurers do not reject claims on this basis. Last month IRDAI had set up a working group to bring uniformity in exclusions in mediclaim policies of different insurers, and minimise the list of exclusions. Experts say this development is also a part of the series of changes that IRDAI is ushering in.  

Mental illnesses can be of various kinds, like mood disorders, obsessive-compulsive disorder (OCD), stress-related conditions, behavioural disorders due to substance abuse, etc. According to the Mental Healthcare Act, 2017, mental health care includes analysis and diagnosis of a person's mental condition and treatment as well as care and rehabilitation of such persons for their mental illness or suspected mental illness. According to Shreeraj Deshpande, head of health insurance, Future Generali India Insurance, "Insurers may come out with products covering mental illnesses or even revise their existing products to include coverage for treatment of mental illnesses," he adds. 

Health insurance policies in India mostly cover hospitalisation based expenses. Most traditional health insurance policies in India have excluded expenses for treatment of mental illnesses. A few health insurers cover certain mental illnesses under OPD (out-patient department) coverage. For instance, Max Bupa offers inbuilt OPD under its GoActive cover, which can be availed for psychiatric consultations on a cashless basis.

However, mental illness will now be treated on the same basis as treatment of physical illness. Now such policies will be extended to cover hospitalisation expenses for treatment of all those mental illnesses that require hospitalisation. "Until now, all the indemnity policies existing in the market have covered different forms of physical ailments. They provide coverage for pre- and post-hospitalisation and wellness benefits. But with this move, policyholders will be able to avail insurance cover for mental illnesses which will increase the ambit of coverage in the same policy that they have," says Ashish Mehrotra, managing director and chief executive officer, Max Bupa health insurance.  

Premium levels are likely to move up, though insurers say that it is difficult to give any numbers right away. "This is a new area that insurers will enter. Data will have to be analysed from available sources to work out the premiums for covering mental illness treatment on only hospitalisation basis, as well as treatment on hospitalisation and OPD," says Deshpande.

Currently, there are comprehensive policies in the market that cover both OPD and hospitalisation costs. These policies could be extended to cover the expenses incurred in the treatment of mental illnesses as well both on OPD and hospitalisation basis."