There has been a little improvement for health insurance policyholders in India, but serious worries persist. While the percentage of consumers experiencing premium hikes of more than 25% has decreased from 62% in 2022 to 52% in 2024, many continue to struggle with growing prices, according to a LocalCircles poll.
This pattern may be traced back to 2022, when insurance firms raised prices significantly in anticipation of another huge COVID outbreak. These high double-digit hikes have persisted for the previous two years, making policyholders feel stressed.
52 percent of personal health insurance policy owners surveyed reported that their premiums had increased by more than 25% in the previous 12 months, while 21% reported that their premiums had jumped by 50% or more. At least 31% reported that health insurance premiums have increased by 25-50%.
The poll gathered more than 11,000 answers from personal health insurance policyholders in 324 districts across India. 67% of responders were male, while 33% were female. 39% of respondents were from tier 1 locales, 30% from tier 2 locations, and 31% from tier 3, 4, or rural areas.
The poll also points out inefficiencies in claim processing, which adds to the frustration.
It discovered that roughly half of all individuals who file a health insurance claim face difficulty. At least 43% of those who made health insurance claims in the last three years reported difficulties in processing. The complaints varied from outright rejection to exclusions, deductions, and, most typically, delays.
The situation is so severe that many patients spend 8-12 hours on their last day before being discharged waiting for their insurance claim to be processed. Doctors and hospital owners are also angry, as the patient is taking up a space that could be utilized to admit and treat another waiting patient. This inefficiency, combined with growing premiums, has prompted calls for action from the Insurance Regulatory and Development Authority of India (IRDAI). The report encourages the IRDAI to adopt a two-pronged strategy:
Rationalize Premium Increases: The study underlines the necessity for the IRDAI to regulate premium increases and make them more rational.
Improve Claim Processing: Streamlining the claim processing system is critical for better serving policyholders and providing prompt assistance when necessary.
The insurance industry accounts for about one-third, or 1.6 lakh, of the 5.5 lakh pending consumer complaints received by the Department of Consumer Affairs, according to participants in a roundtable on Consumers and the Insurance industry held last year. This reform movement reflects a growing demand for a health insurance system that prioritizes policyholders' needs. According to the study, health insurance will only truly become a trustworthy safety net for Indian consumers if growing rates and claim processing inefficiencies are addressed simultaneously.
