Mumbai: The Bombay High Court today asked Insurance Regulatory and Development Authority (IRDA) to check whether the insurance companies had issued guidelines to third party administrators (TPA) on how to recommend claims amounts for mediclaim and health insurance policies.

The direction was given by a bench headed by Chief Justice Mohit Shah who asked IRDA to file its response on this aspect within four weeks.

The court was hearing a PIL filed by social worker Gaurang Damani detailing hardships faced by mediclaim policy holders.
After a series of hearings, the court had in December 2012 directed IRDA to incorporate regulations for health insurance policies. Accordingly, the authorities came out with a set of regulations in a gazette notification in February 2013. The regulations became effective in October 2013.

The petitioner pointed out that IRDA had orally assured the court that TPAs would not settle the claim amount. However, in the regulations notified by IRDA it was stated in section 12(b) that though TPAs would not settle the claim amount they would recommend the claims based on certain guidelines.

Damani objected to this point in the regulation, which gave TPAs the power to recommend the claims to the insurance companies. He said that there were no guidelines framed on the basis of which TPAs were authorised to recommend the claims.

The court then directed the IRDA to find out whether such guidelines had been issued to TPAs by the insurance companies on recommending claim amounts.

Damani said that as per the IRDA affidavit filed last year, there were six lakh health insurance claims pending, which amounted to around Rs 1,200 crore. He alleged that this was because the TPAs were doing the settlement and not the insurance companies.

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Free Press Journal