IRDA new circulation: Pay Health Insurance Premium in Instalments

IRDA’s Big Move That Will Change How You Pay Your Health Insurance Premium and More

For most of us, paying health insurance premium is a question to look at our pocket. If you pay a health insurance premium for yourself, family members, and parents, then chances are your palm is on your face at the time of renewal.

If you don’t have a health policy, the reason you always step back despite knowing its importance could be its annual premium amount.

Yes, you may get tax benefits when it comes to the premium under section 80D, but to pay the premium all at once, is too much. 

Isn’t it? Well, if that’s the case, then I have got good news for you: Now you can pay your health insurance premium in instalments with no change in the premium.

The Insurance Regulatory and Development Authority of India (IRDAI) has passed a circular in which it gives more freedom to the insurance companies and relief to consumers. 

Let’s see: What’s the IRDA’s big move and how it will be beneficial to you and insurers.

Minor modifications that are allowed to the insurance companies to make in the health products without seeking IRDA’s approval (From the circular passed by IRDA):

1) Addition of premium payment options (frequency/payment of premiums in instalments).

2) Addition of distribution channels.

3) Change in the base premium rates, not exceeding + or – 15% of the premium rates of originally approved individual product.

4) Addition of approved standalone riders or add-ons to the approved individual health insurance products.

5) Minor Changes in Policy Wordings.

6) Change in the name of the approved product subject to complying with the provisions of Clause (4) (xii) of Chapter – II of Guidelines on Product Filing.

7) Change in sum insured options made available to the policyholder within the sum insured range filed.

8) Decrease in minimum and/or increase in maximum premiums.

9) Decrease in minimum and/or increase in maximum entry age.

10) Extension of the premium table to provide premium rates for lower and/or higher ages or longer and/or shorter policy terms or premium payment terms.

11) Expansion of the list of daycare procedures to be offered.

12) Addition of Critical Illnesses covered under benefit based products.

How Are These Modifications Going To Be Beneficial To You?

a) You can pay the premium monthly, quarterly, half-yearly, and annually.

What could it mean to you? 

More flexibility. Don’t have to look at your pocket at the time of renewal. Easy on pocket. Worry-free mind.

b) IRDA has given its nod to the insurers that allow them to increase or decrease the insurance premium by up to 15 per cent, subject to their claim experience in a particular sector. Therefore, in case an insurance company faces higher loss ratio or higher claim, it need not file permission to the IRDAI for increasing the insurance premium.

What could it mean to you? 

Possible changes in premiums up to +/- 15% of the original premium. Lower or higher premiums as per the claims filed under a particular product. In the case of lower number of filed claims, lower premium. And, in the case of a higher number of filed claims, higher premium. 

c) IRDA has also given its nod to the insurers to add approved standalone riders or add-ons to approved individual health insurance products without having to file the product again. Expansion of the list of offered daycare procedures and addition of critical illnesses covered under benefit-based products.

What could it mean to you?

You can head on to have add-ons to your base plan. Often, insurers come up with new add-ons or riders to enhance the coverage, which you can add those to your base plan.

Moreover, most insurance companies may look forward to expanding the list of daycare procedures, giving you more options.

d) Insurance companies can make minor changes in the policy document without making any changes in the product policy: no changes in the time-bound waiting period, coverage terms and conditions, and should not impose any deductible, co-pay or sub-limits afresh. 

What could it mean to you?

More clarity. More transparency. Better understanding of the product, exclusions, and claims process.

More Heads Insured — More Worry-free Lives

This circular by IRDA is a big move, which will give more freedom to insurers, increase insurance penetration in India, flexibility to consumers to pay the premium and possibility of changes in entry age by insurance companies.

Earlier, the option of premium payment in instalment was available only under life insurance products. Adding this to health insurance products could increase the number of people who will opt for health plans in India. Perhaps, an incentive for the people to buy an insurance cover.

And, ultimately, increase in the number of insured people and deepening of insurance penetration.

As per IRDA, all this comes into force with immediate effect.

Sharing is caring: Share this post and help people to stay covered.

Live Healthily. Stay Covered!


Insurance FAQs

Most frequent questions and answers about insurance​

What is Utmost Good Faith?

Utmost Good Faith is one of the principles that insurance is based on. It denotes a positive duty of the person seeking insurance to voluntarily disclose accurately and fully, all facts material to the risk being proposed whether requested or not.

What is meant by Insurable Interest?

The financial interest that the assured possesses in whatever is being insured is known as “Insurable interest”. In other words, it is the right of a person to insure something which, when lost or damaged, would mean a financial loss to him. 

If a person is allowed to insure something that he does not own it becomes a wagering contract and therefore void under Section 30 of Indian Contract Act. 

Therefore Insurable interest is a pre-requisite for insurance and the compensation is limited by the value of the subject matter of insurance and the extent of insurance coverage. In Life Insurance, though human life value cannot be measured in monetary terms, insurers determine the sum assured as a multiple of the income of the life assured and his remaining productive years.

What is the difference between an Insurance Agent and an Insurance Broker?

You can get your driving license number online by visiting the Sarathi website or if you are not familiar of the online process, you can visit the RTO office in your town.

What is an 'insured peril'?

The purpose of insurance is to compensate you for a loss caused by an insured perils. If your stocks are destroyed in a fire, the cause of loss is fire which is payable under a fire policy. If the stocks are stolen, the loss is not payable under a fire policy as “Burglary” is not a covered peril.

Can an insured claim any amount from his insurer regardless of the extent of loss?

No. The loss will be surveyed and amount payable assessed and this is subject to calculations like depreciation and policy excess so that the compensation is strictly for the loss suffered and to the extent suffered. The concept is that an insurance policy should not be the means to making a profit. However it is possible to take some policies on a ‘Reinstatement Value Basis’ so that, in the event of a loss, the claim will be paid on the basis of creating a new asset in the place of the old one rather than on the depreciated or market value of the old asset.

What is the meaning of Deductibles?

In some policies there is a clause that a specified amount will be deducted from the claim amount. For example in Industrial Risks 0.5 per cent of the total sum insured subject to a minimum of Rs.1 lakh is the deductible if loss is due to Terrorist Act. This means that the first Rs one lakh of any claim and up to 0.5 per cent of the claim has to be borne by the insured. If the loss is below Rs one lakh then no claim is payable. 

This is a way for the insurance companies to avoid the administrative costs of small claims and the insured is usually given a premium rebate for accepting this burden.

What is the meaning of Co-Insurance?

Corporate clients, who want to oblige more than one insurer, or benefit from the competitive forces among insurers, place their insurance business with more than one insurance company.  While doing so, they select one company as the “Leader” who is given higher share of premium and others are given lesser share.  Client deals only with the “Leader”. The leader will share the premium (in the ratio decided by the client) as well as claims with other participating insurers who are called Co-insurers.  Depending on the total volume of premium, it can be placed with 2, 3, 4 or more insurers.

Is the Insured responsible for Loss Minimisation?

Even when a property is insured, it is the responsibility of insured to take all reasonable steps to protect against or minimise the loss. Every insured is expected to behave as though he is “a prudent uninsured”. 
If the insured neglects to take such steps, as per the policy condition of “Negligence”, the claim can be repudiated or partially allowed.

What are the Rules of the Insurance Ombudsman Scheme?

The objective of the Insurance Ombudsman Rules is to resolve all complaints relating to 

1. Partial or total repudiation of claims  
2. Any dispute regarding premium paid or payable in terms of the policy  
3. Any dispute about the legal construction of the policy relating to claims  
4. Delay in settlement of claims  
5. Non-issue of any insurance document to customers after receipt of premium, in a cost effective, efficient and impartial manner.  

These rules are called Public Grievances Rules – 1998 and were notified by Government of India and published in the Gazette of India on 11.11.1998. 

What is a TPA and what are its functions?

A TPA is a Third Party Administrator. They are commercial entities duly licensed by IRDA. Their services are utilised by Insurance Companies, both Life and Non-Life, to render, on their behalf, post-sales services to health insurance policyholders. 

They provide services like:

Guiding the insured with regard to claims

Issuing photo ID cards to insured persons

Issuing pre-authorisation to hospitals to facilitate insured persons to avail of the cashless facility and

Process and settle claims for reimbursement

Claims FAQs

Most frequent questions and answers about insurance claims


Original Invoice with proper serial number / Model details with insured’s or family member’s name to prove the insurable interest.

If proper details and declarations are available in the PF, invoice can be waived off, this will be applicable for gifted items also.

Duly filled and signed claim form with detailed note on the incidence happened. Need the elaborate narration about the incidence to prove the perils operated in the incidence.

Authorised service centre report and estimation on repairing cost with proper reasons of parts replacement.

Final repair bill from authorised service centre.

Photographs of damaged portable item


Original Invoice with proper serial number / Model details with insured’s or family member’s name to prove the insurable interest.

If proper details and declarations are available in the PF, invoice can be waived off, this will be applicable for gifted items also.

Duly filled and signed claim form with detailed note on the incidence happened. Need the elaborate narration about the incidence to prove the perils operated in the incidence.

Copy of FIR lodged at nearby Police station


In Electronics world, the device life is very short and most the OEMs are launch their new models with better features on regular basis, keeping the earlier models on discontinue mode, hence assessment on such models will be strictly on the basis of ‘Obsolete’ condition. Liability of the company will be maximum 50% of new / upgraded version of the same model.


Duly filled and signed claim form with detailed note on the incidence happened. Need the elaborate narration about the incidence to prove the perils operated in the incidence.

Authorised service centre report and estimation on repairing cost with proper reasons of parts replacement.

Final repair bill from authorised service centre.

Invoice copy – to determine the age of the equipment, if not available then age will be determined on the other details available such as model name / number, serial number and any decision on taken on the age will be final to decide the claims admissibility.

Photographs of damaged item


Duly filled and signed claim form with detailed note on the incidence happened. Need the elaborate narration about the incidence to prove the perils operated in the incidence.

Ownership documents to prove the insurable interest and age of the building to decide the assessment on the basis of plan selected for the coverage.

Repairs estimates and bills

Fire Brigade report in case of fire

Meteorological report in case of Act of God peril like earthquake, storm, etc.

Find Your Insurer

Finding a reliable Advisor?

Find Your Insurer

AEGON Religare Life Insurance Co. Ltd.

Building No 3, Third floor, Unit No.1, Nesco IT Park, Western Express Highway, Goregaon (E), Mumbai – 400063


Aviva Life Insurance Co. India Ltd.

Aviva Tower, Sector Road, Opposite Golf Course, DLF-Phase V, Sector-43, Gurgaon – 122003


Bajaj Allianz Life Insurance Co. Ltd.

GE Plaza, Airport Road, Yerawada, Pune – 411006


Bharti AXA Life Insurance Co. Ltd.

601-602, 6th Floor, Raheja Titanium, Off Western Express Highway, Goregaon (E), Mumbai – 400 063


Birla Sun Life Insurance Co. Ltd.

One India Bulls Centre, Tower 1, 16th Floor, Jupiter Mill Compound, 841, Senapati Bapat Marg, Elphinstone Road, Mumbai – 400013


Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd.

Augusta Point, 2nd Floor, DLF Golf Course Road, Sector-53, Gurgaon – 122002


DHFL Pramerica Life Insurance Co. Ltd.

4th Floor, Tower B, Building No. 9, DLF Cyber City, Phase-III, Gurgaon – 122002


Edelweiss Tokio Life Insurance Co. Ltd.

Edelweiss House, Off C.S.T. Road, Kalina, Mumbai – 400098


Exide Life Insurance Co. Ltd.

ING Vysya Home, 5th Floor, #22, Mahatma Gandhi Road, Bangalore – 560001


Future Generali India Life Insurance Co. Ltd.

6th Floor, Tower 3, Indiabulls Finance Centre, Senapati Bapat Marg, Eliphinstone Road (W), Mumbai – 400013


HDFC Standard Life Insurance Co. Ltd.

19th Floor, Lodha Excelus, Apollo Mills Compound, N. M. Joshi Road, Mahalaxmi, Mumbai – 400011


ICICI Prudential Life Insurance Co. Ltd.

ICICI Prulife Towers, 1089, Appasaheb Marathe Marg, Prabhadevi, Mumbai – 400025


IDBI Federal Life Insurance Co. Ltd.

Tradeview, 1st Floor, Oasis Complex, Kamala City, P. B. Marg, Lower Parel (W), Mumbai – 400013


IndiaFirst Life Insurance Co. Ltd.

301, ‘B’ Wing, The Qube, Infinity Park, Dindoshi – Film City Road, Malad (E), Mumbai – 400097


Kotak Mahindra Old Mutual Life Insurance Ltd.

4th Floor, Vinay Bhavya Complex, 159 A, C.S.T. Road, Kalina, Santacruz (E), Mumbai – 400098


Life Insurance Corporation of India Ltd.

Yogakshema, Jeeva Bima Marg, Post Box No. 19953, Mumbai – 400021


Max Life Insurance Co. Ltd.

11th Floor, DLF Square, Jacaranda Marg, DLF City, Phase-II, Gurgaon – 122002


PNB Metlife India Insurance Co. Ltd.

Brigade Seshamahal, No. 5, Vani Vilas Road, Basavanagudi, Bangalore – 560004


Reliance Life Insurance Co. Ltd.

9th& 10th floor, Building No. 2, R-Tech Park, Nirlon Compound, Next to Hub Mall, Behind I-Flex Building, Goregaon (E), Mumbai – 400063


Sahara India Life Insurance Co, Ltd.

#1, Sahara India Bhawan, Kapoorthala Complex, Lucknow – 226024


SBI Life Insurance Co. Ltd.

Natraj, M.V. Road & Western Express Highway Junction, Andheri (E), Mumbai – 400069


Shriram Life Insurance Co, Ltd.

Ramky Selenium, Plot No 31 & 32, Beside Andhra Bank Training Centre, Financial District, Gachibowli, Hyderabad – 500032


Star Union Dai-ichi Life Insurance Co. Ltd.

Star House, 3rd Floor, (West Wing), C-5, Bandra Kurla Complex, Bandra (E), Mumbai – 400051


Tata AIA Life Insurance Co. Ltd.

14th Floor, Tower–A, Peninsula Business Park, Senapati Bapat Marg, Mumbai – 400013