You are suffering from severe anxiety or depression. Your psychiatrist suggests hospitalization or expensive therapy.
You hesitate. "I can't afford this. And my Mediclaim policy surely won't cover 'mental' issues."
You are wrong.
Since 2018, it has been ILLEGAL for insurance companies in India to discriminate against mental illness.
If your policy covers a heart attack, it MUST cover a panic attack.
Disclaimer: While hospitalization is mandated, insurers often impose Sub-Limits (Caps) on the claim amount. OPD (therapy) is usually extra. Check your policy wording.
Depressed? Your Health Insurance MUST Pay for It
1. The Law That Changed Everything (MHC Act 2017)
The Mental Healthcare Act, 2017 (enforced by IRDAI) states:
⚖️ The Mandate
"Every insurer shall make provision for medical insurance for treatment of mental illness on the same basis as is available for treatment of physical illness."
This means insurers cannot have a clause saying "Psychiatric treatments are excluded." If they do, you can legally challenge them.
2. What Is Covered? (In-Patient vs. OPD)
This is where the confusion lies.
🏥 In-Patient Hospitalization (Covered)
If you are admitted to a hospital for more than 24 hours due to severe clinical depression, bipolar disorder, schizophrenia, or PTSD, the insurance company MUST pay the bill (room rent, medicines, doctor fees), just like they would for Dengue or Malaria.
🛋️ OPD / Therapy Sessions (Check Carefully)
Most standard policies do NOT cover "Out-Patient Department" (OPD) expenses like weekly therapy visits.
Solution: Look for premium policies with explicit "OPD Cover" (like Star Health Comprehensive or Niva Bupa ReAssure) to get consultation fees reimbursed.
3. The "Waiting Period" Update (2024 Rules)
Mental Illness is often treated as a Pre-existing Disease (PED).
- If you have a history: You must declare it. There will be a waiting period.
- Good News (2024 Update): Effective April 1, 2024, IRDAI reduced the maximum waiting period for PEDs from 4 years to 3 years. Insurers cannot make you wait longer than 36 months.
- If you develop it later: If you are diagnosed after buying the policy, it is covered immediately (after the initial 30-day waiting period).
4. The Hidden Traps (Exclusions & Caps)
Even with the new law, insurers have ways to limit their payout:
- The Sub-Limit Trap: While they cover mental illness, many policies cap the payout (e.g., "Max ₹50,000 for Psychiatric Hospitalization") even if your total cover is ₹10 Lakhs. Check this limit!
- Substance Abuse: Treatments specifically for Alcoholism or Drug Addiction are still standard exclusions in most retail policies.
- Self-Harm: Despite the decriminalization of suicide, expenses arising from Intentional Self-Injury are generally NOT covered.
5. Why You Must Declare It
Do not hide your history of anxiety or antidepressants to get a lower premium.
If you are hospitalized for a "nervous breakdown" later, and the insurer finds a 5-year-old prescription in your records, they will reject the claim for "Non-Disclosure."
Be honest. Serve the 3-year waiting period. Get guaranteed coverage.
Don't Suffer in Silence and Poverty
Mental health treatment is expensive, but it is necessary.
Your insurance policy is a financial tool designed to support you in your darkest times. Use it.
If your insurer rejects a valid hospitalization claim for covered mental illness, quote the "IRDAI Circular on Mental Healthcare Act 2017" to the Grievance Officer.
Action Plan:
- Check your policy for "Mental Illness" in the exclusions list. (If excluded, the policy is non-compliant).
- Look for Sub-Limits: Are you covered for the full sum insured or just a small fraction?
- If buying new, confirm the 3-year waiting period applies and declare all history honestly.
Helpful Resources:
IRDAI Guidelines on Mental Illness Coverage
ManipalCigna: Mental Health Insurance Explained
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