For now, the Insurance Regulatory and Development Authority of India (Irdai) has taken immediate measures. On 4 March, Irdai said all coronavirus-related claims shall be expeditiously handled and all expenses incurred during the course of treatment, including during the quarantine period, shall be covered by all insurers. It has also asked insurers to offer need-based health insurance plans to cover the cost of treatment for coronavirus. “A basic health insurance policy will certainly cover the medical expenses incurred on hospitalization for any viral infection, including coronavirus. However, infectious diseases are not covered for the first 30 days from the inception of the policy," said Anurag Rastogi, chief actuary and chief underwriting officer, HDFC ERGO General Insurance Co. Ltd.

However, if coronavirus is declared a pandemic, health insurance may not cover the expenses. We tell you the kind of expenses that will be covered if you do get infected, and the claims process you need to follow. Further, does it make sense to buy coronavirus-specific policies?

According to the World Health Organization (WHO), a pandemic is the worldwide spread of a new disease. The 2009 H1N1 flu was the last pandemic and it killed hundreds of thousands of people globally. According to WHO data, as on 8 March, over 1,05,586 people have been tested positive for coronavirus worldwide, with at least 3,584 deaths. Experts believe that if the spread continues, it could be declared a pandemic.

So will health insurers cover policyholders once Covid-19 is declared a pandemic by WHO and the government of India? “In case WHO declares Covid-19 as a pandemic and the same is ratified by the government of India, in some of the insurance plans, exclusion for global pandemic will get triggered, after which you may not get the cover," said Pankaj Verma, head, market underwriting operation, SBI General Insurance Co. Ltd.

Still, it’s advisable to check with your insurance company individually because it also depends on how the company has filed its products with the regulator. Digit Insurance, for example, said their health products do not exclude pandemics.

After Irdai’s circular, insurers are mandated to cover hospitalization as well as quarantine expenses if you test positive. “Insurance companies will pay admissible medical expenses even during quarantine. This does not require a separate out-patient (OPD) cover," said Anik Jain, co-founder and CEO, Symbo India Insurance Broking Ltd. Rastogi said treatment taken while in quarantine will be paid as hospitalization expenses which are covered under a regular health insurance policy.

You could also be worried about what happens if you’ve travelled abroad. Can your insurer deny the claim? Whether your claim is approved or not has nothing to do with your travel history. Insurers Mint spoke with said once someone tests positive, the claim will be processed. Verma said if one has fallen ill in India and is hospitalized, their travel history may be asked for the sake of data collection but it will have no impact on claim disbursement. This also includes travelling to a highly-affected region such as China and Italy.

“Coronavirus is nothing but a new strain of influenza virus. If you look up the global medical history, you’ll find that every 300 years or so, a new influenza virus travels from animals to humans and causes trouble. Hence, this (coronavirus-related illness) cannot be classified as a critical illness and will not be covered under a critical illness policy," said Verma.

The claims process will remain the same as in the case of any other ailment.

Need-based policy

Irdai, through its circular, has encouraged insurers to design coronavirus-specific policies. In line with this, Digit Insurance, under Irdai’s sandbox regulations, launched a defined-benefit health policy for coronavirus last week. Under this, policyholders get the full sum insured on being tested positive for the disease after which the policy terminates.

The premium for the policy starts at ₹299 (including taxes) for a sum insured of ₹25,000. “One restriction which comes with a regular health insurance policy is that it requires 24 hours of hospitalization for you to be able to file a claim. Some policies do include OPD expenses but most products which include OPD expenses don’t have many takers because the premium is relatively higher," said Vivek Chaturvedi, head of marketing and direct (online) sales, Digit Insurance.

As it’s a one-year cover, the insured person should not come in contact with such a person during the policy period. Also, the insured or their immediate family members should not have travelled to countries such as China, Japan, Singapore, Thailand, Malaysia, Hong Kong, Macau, Italy, Iran, Bahrain, Kuwait, Taiwan after 1 December 2019. Policyholders suffering from symptoms such as a cough, with or without sputum; cold or nasal block; fever with body pain and shortness of breath for the last six weeks of buying the policy will also not be eligible to get a claim.

You could consider this product if you don’t have a health insurance policy in place and are worried about contracting the virus. However, Mint recommends going for a standard health plan first, as it would cover you for hospitalization under any condition. Many health policies also cover pre- and post-hospitalization expenses.