Health Insurance
The Health Insurance domain tests how well you can explain indemnity and defined-benefit health products, the regulatory waiting periods and claim mechanics that decide whether a bill is paid, and the disclosure duties that fall on the agent at point of sale.
Core rules
Health indemnity policies reimburse actual hospitalisation expenses up to the sum insured; they are not savings or investment products. IRDAI's health insurance regulations, as amended in 2024, set a maximum pre-existing disease (PED) waiting period of three years; PED means a condition diagnosed or treated in the 48 months before cover. A 30-day initial waiting period applies to illness (not accident), specific diseases may carry a two-year wait, and a 60-month moratorium protects the insurer's right to contest non-fraud claims after five continuous policy years. Portability preserves accrued waiting-period credit when switching insurers; migration moves a policyholder to another product with the same insurer. Cashless settlement runs through network hospitals and TPAs; reimbursement requires bills and discharge summary. Free-look is 30 days.
Worked example
A 45-year-old declares no illness and buys a ₹10 lakh family floater with a 1% room-rent cap. He had been treated for hypertension 20 months before inception, so it is PED. In year 2 he is hospitalised for a hypertension-related stroke and bills ₹6 lakh, including room rent of ₹14,000/day for 5 days against the ₹10,000 cap. The PED exclusion applies, so the claim is not payable. Even if it were, the room-rent breach would trigger a proportionate deduction: ₹10,000/₹14,000 applied to associated charges. Had the same claim arisen after the three-year waiting period, it would be assessed on its merits.
Traps
Do not treat critical illness cover as indemnity - it pays a lump sum on diagnosis. Do not say portability resets waiting periods. Do not confuse the 30-day initial wait with the PED wait. Do not ignore sub-limits and co-payment when quoting a premium. Never advise non-disclosure to avoid loading; it lets the insurer repudiate.