Health insurance prices to rise..!? Public in trouble..!?

There have been worrying changes in the health insurance sector of india in recent times. Many people have come to the point of withdrawing their health insurance policies. The main reasons for this change are increased premiums, increase in GST (Goods and services Tax), and rejection of claims. health insurance premiums have increased significantly in the last few years. Instead of the previous 15% service tax, an 18% tax was imposed after the introduction of GST, which has further increased premiums. This increase has made insurance policies unaffordable, especially for low-income people.
Claims Rejection: Many policyholders have seen an increase in the number of claims being rejected by insurance companies for their medical expenses. These rejections are due to reasons like policy conditions, missing information about pre-existing conditions, or claims being made during the waiting period. Such experiences have eroded the confidence of policyholders. In this environment, many individuals are deciding to opt out of insurance policies or exploring alternatives. Some are reducing their premiums, and reducing coverage, while others are canceling policies altogether. Also, some are coming forward to create personal savings for medical expenses. Subhadip Ghosh, 38, from Kolkata, started a family floater health insurance policy for Rs 5 lakh in 2016, paying an annual premium of Rs 22,000. However, over the years, the premium for the same insurance has gone up to Rs 78,000 in 2025, prompting Ghosh to reconsider his options. Despite a 10% no-claim discount, his premiums have almost doubled since the pandemic. For many like Ghosh, premiums are no longer an affordable part of their budget. Srishti, a legal executive from south Delhi, shares similar concerns. After a friend's request was rejected by his insurer, Srishti, who was paying nearly Rs 3 lakh in premiums per year for a Rs 40 lakh cover, decided to opt out of his policy altogether.
 
"We pay nearly Rs 3 lakh in premiums per year. Then a claim is rejected, and none of your insurance is counted," he says. To regain confidence in the health insurance industry, reducing the GST rate on health insurance premiums from 18% to 5% can make premiums cheaper. Insurance companies should clarify policy conditions and improve consumer understanding. It is necessary to clarify the reasons for claims rejection and simplify the process. The government should take steps to regulate hospital charges and negotiate better prices with insurance companies.
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Sowmiya Sriram

07/04/2025 11:08 AM