India: IRDA directs insurers to cover mental illness

August 24, 2018

IRDA directs insurers


Insurance is the umbrella which mitigates the loss caused by an uncertain event. A contract of insurance is an agreement whereby one party undertakes to pay a certain sum of money on the occurrence of any contingency. Being a contract of indemnity, it is based on the principle of utmost good faith. In today’s world, the insurance companies offer insurance policies of varied nature including life, health, fire, marine, etc. Individuals purchase such policies either in their individual capacity or the employee friendly organizations may extend such cover as perks of the employment.

In India, the Insurance Regulatory and Development Authority (hereinafter referred to as “IRDA”) regulates, promotes and ensures orderly growth of the insurance industry, protection of the policy holders and settlement of insurance claims. Medical insurance facilities in India cover wellness and preventive hospitalization expenses and treatment costs. Different policies cover health issues of varied nature including various diseases. In furtherance to this as well as the Mental Healthcare Act,2017 which came into force on May 29, 2018, directed all insurers to make provision for medical insurance for treatment of mental illness on the same basis as is available for treatment of physical illness.

By this approach, the IRDA aims to provide equal treatment opportunities for patients with mental ailments thereby maintaining their dignity. This places importance on the need to emphasize the care to be taken with respect to mental health. It also adds to the responsibilities of the insurance companies not to shirk from their duty towards the health (both mental and physical) of its policy holders.

For more information please contact us at :