IRDAI — Insurance Regulations & Policyholder Rights
Complete guide to IRDAI insurance regulations — policyholder rights, claim settlement rules, free-look period, ULIP rules, health insurance portability, motor insurance, and grievance redressal.
🏛️ Background
The Insurance Regulatory and Development Authority of India (IRDAI) was established under the IRDAI Act, 1999 on 19 April 2000, headquartered in Hyderabad. It regulates and promotes the insurance industry — life, non-life, and reinsurance. In 2024, IRDAI announced the ambitious "Insurance for All by 2047" vision. The Insurance Act, 1938 and subsequent amendments form the foundational legal framework.
🛡️ Key Policyholder Rights
🔄 Free-Look Period
30 days (15 days for offline, 30 for online) after receiving policy to review and return it for full refund minus proportional risk charges and stamp duty. Life insurance only.
⏰ Claim Settlement Timeline
Life insurance: 30 days from receipt of all documents (non-investigation). Health: 30 days from last document. Motor own damage: 30 days. Interest payable on delayed settlements.
🔓 Anti-Rejection after 3 Years
Life insurance policy cannot be challenged on any ground after 3 years from commencement (Section 45, Insurance Act). Except proven fraud.
🏥 Health Insurance Portability
Port your health insurance to another insurer without losing accumulated benefits (waiting period credits, no-claim bonus). Apply 45 days before renewal.
🏥 Health Insurance — Key Rules
- ✅ Pre-existing disease: Maximum waiting period reduced to 3 years (from 4 years, per IRDAI 2024). Moratorium after 8 years — no claim rejection for non-disclosure after this period.
- ✅ Cashless everywhere: Insurer must provide cashless facility at ALL network hospitals. Cannot refuse if hospital is in network.
- ✅ No age bar: No upper age limit for purchasing health insurance (IRDAI directive). Insurers cannot refuse merely based on age.
- ✅ AYUSH coverage: Mandatory coverage for Ayurveda, Yoga, Naturopathy, Unani, Siddha, and Homeopathy treatments in all health policies.
- ✅ Day-care procedures: Must cover all listed day-care procedures (no hospitalization required for >24 hours).
🚗 Motor Insurance — Mandatory Rules
- 🚗 Third-party insurance is MANDATORY under the Motor Vehicles Act, 1988. Driving without it → fine ₹2,000 or imprisonment up to 3 months or both.
- 🚗 Long-term third-party: 3-year for new cars, 5-year for new two-wheelers (IRDAI 2018). Own-damage can be 1-year.
- 🚗 No-Claim Bonus (NCB): 20% after 1 claim-free year, up to 50% after 5+ years. NCB stays with owner, not vehicle. Transfer allowed when switching insurer.
⚠️ Disclaimer
This page is for educational and informational purposes only and does not constitute legal, tax, or financial advice. While we strive for 100% accuracy, laws and regulations change frequently. Always refer to the official gazette notifications, consult a qualified Chartered Accountant (CA), Company Secretary (CS), or legal professional before making any financial or legal decisions. Tenhash is not responsible for any actions taken based on this information. Last reviewed: March 2026.