Third Party Administrators (TPA) - Health Insurance
TPAs are licensed by IRDA and are engaged for a fee or remuneration for the provision of health services. Health services means all the services rendered by a TPA as per the terms of agreement entered into with an insurance company in connection with health insurance business, however the services rendered will not include either insurance business or soliciting of insurance business either directly or through an intermediary. They are normally contracted by a health insurer to administer services, including claims administration, premium collection, enrollment and other administrative activities.
The license to act as TPA is granted by IRDA only to companies which have a share capital and are registered under Companies Act, 1956. As per the memorandum of the company, the primary objective should be to carry on business in India as TPA in the health services and they are not permitted to transact any other business. The minimum capital prescribed is Rs. 1,00,00,000 .
As per the act at least one of the directors should be a qualified medical doctor registered with Medical Council of India. The Chief Executive Officer (CEO) of the company has to under go training as prescribed by the IRDA.
The TPA can enter into agreement with more than one insurance company and the insurance companies can also deal with more than one TPA.
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