Why mental illness is excluded from full coverage of insurance policy: HC asks IRDAI

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New Delhi: The Delhi High Court has asked insurance sector regulator IRDAI to explain on what basis it was approving insurance policies that excluded mental conditions from full coverage.

Justice Prathiba M Singh said the Mental Healthcare Act of 2017 makes it clear that there can be no discrimination between mental and physical illnesses and the insurance provided in respect thereof.

The direction to the Insurance Regulatory and Development Authority of India (IRDAI) by the court came on a plea of a man whose claim for reimbursement of costs in the treatment of his mental illness was restricted to Rs 50,000 by the insurance provider – Max Bupa Health Insurance Company Ltd.

The court issued notice to IRDA and Max Bupa seeking their stand within two weeks, saying a large number of insured persons would be affected by such an insurance policy.

The petitioner has contended that he has been regularly paying the premium for a sum assured of Rs 35 lakh, but when he claimed the insurance amount for his treament, he came to know that in case of a mental illness the sum assured is restricted to Rs 50,000.

His lawyer told the court that on perusing the fine print, almost all the prevalent mental conditions, like severe depression, eating disorder, panic disorder, schizophrenia, post-traumatic stress disorder and obsessive-compulsive disorder, are restricted to a sum assured of Rs 50,000.

The petitioner has contended that such a restriction is contrary to the provisions of the Mental Healthcare Act of 2017.

After hearing the petitioner’s side, the court said, “The clauses pointed out in the policy clearly show that a large number of mental conditions are excluded from full coverage of the policy and only a sum of Rs 50,000 is reimbursable for these mental conditions.

“This matter requires consideration, inasmuch as the Insurance Regulatory and Development Authority of India ought to place on record the basis on which approval has been granted for such insurance policies.” The court listed the matter for further hearing on June 2.