India's health insurance claims show why buying early matters

A parliamentary committee is considering caps on hospital room rents, linked to local three-star hotel rates, and limits on surgery costs. The aim is to slow medical inflation that has accelerated since the pandemic.

The discussion coincides with a detailed study by Policybazaar.com, which analysed 870,000 health insurance claims filed between 2021 and 2026. The data reveals a clear age gradient. Average claims for policyholders over 60 are 170% higher than for those aged 0–25. Younger policyholders typically file claims for infections, injuries and maternity-related expenses, while the 60-plus cohort is more likely to claim for cardiac, cancer, kidney and other chronic conditions.

Policybazaar's analysis found that 56% of all claims came from the 26–45 age group, even though individual claim amounts are lower for that cohort. The implication, the study said, is that health insurance is not just a product for the elderly. Buying it early helps policyholders complete the three-year pre-existing disease (PED) waiting period and the five-year moratorium period, after which claim rejections become rare. PED is the most common reason for claim rejection.

For older policyholders, annual premiums can range from ₹70,000 to ₹1 lakh, putting coverage out of reach for many households. The average claim in that age bracket is ₹1.8 lakh. The risk of remaining uninsured is significant, the study noted.

The study also flagged the rising burden of chronic conditions – diabetes, heart disease, cancer and kidney ailments that require care for more than a year. Chronic illnesses account for 27% of claims by number but 42% by value. The average claim for a chronic condition is ₹2.66 lakh, four times the average for non-chronic claims. As economies develop, healthcare demand shifts from acute care to chronic care, and India is following that pattern, Policybazaar said.