Insurance Cover to Disabled Persons in India

As per the Insurance Regulatory and Development Authority of India (IRDAI) mentally challenged people to get covered under medical insurance policies sold by Public Sector General Insurance Companies (PSGICs). Presently, the PSGICs provide mental illness coverage to children if covered with or both parents simultaneously in the policy. Some PSGICs also provide mental illness cover to persons under Employer-Employee Group Health Insurance Policies.

While Life Insurance Risk coverage is offered to handicapped and mentally challenged persons by the life insurance companies (both public sector and private sector) based on their board-approved underwriting policy, the disclosures made in the proposal form, every life insurance company will rate the person to be insured from the point of view of risk assessment and underwriting as standard or sub-standard lives in order to determine acceptance of the proposal and the premium to be charged.

While there are no restrictions for providing insurance facilities to handicapped and mentally challenged persons, it is the professional decision of the insurance company based on their own risk-bearing capacity and approach. There are no specific Regulations/Guidelines issued by the Authority in this regard.

The Government of India is implementing a scheme by the name ‘NIRAMAYA’ through which the handicapped and mentally challenged persons are covered for medical treatment up to Rs. 1 lakh. Aam Admi Bima Yojana (AABY) is also a Government Social Security Scheme being administered through the Life Insurance Corporation of India (LIC) that provides life/accident insurance protection to rural and urban poor persons (including rural landless households) and people belonging to certain identified vocational groups. One such identified vocation is “Physically Handicapped Self-Employed Persons”.