Health insurance is an important financial protection for individuals and families in India. It can help to cover the cost of medical expenses, such as hospital stays, surgery, and prescription drugs.
A recent report by the Insurance Regulatory and Development Authority of India (IRDAI) found that the average cost of health insurance claims in India is Rs 42,000. The report also found that 15% of claims exceeded Rs 100,000.
Just 0.2 percent were for amounts greater than Rs 1 million, while 85 per cent claims were for less than Rs 100,000.
This highlights the need for policyholders and insurance providers to consider potential high-cost scenarios, such as hospitalizations exceeding five days and costing over Rs 5 lakh, when designing coverage options.
According to SecureNow’s study, typical hospitalization is for two days, but over 21 percent is for three or more days. Day-care procedures account for 29 percent of the claims.
SecureNow analyzed 3,846 health claims filed through the reimbursement process (as opposed to cashless). These claims were geographically diverse and covered different kinds of insurers, family members, and both external and internal TPAs.
The high cost of health insurance claims in India is due to a number of factors, including:
- The rising cost of medical care in India.
- The increasing incidence of chronic diseases, such as cancer and heart disease.
- The growing population of India, which is putting a strain on the healthcare system.
The high cost of health insurance claims can be a financial burden for individuals and families. However, health insurance can help to protect them from financial ruin in the event of a major medical expense.
The IRDAI report also found that the most common reasons for health insurance claims in India are:
- Hospitalization (40%)
- Surgery (25%)
- Prescription drugs (15%)
- Outpatient care (10%)
At least 50% of claims have a settlement rate of 80 per cent or higher of claims made. Maternity claims contribute significantly, comprising 20 per cent of total claims as a segment.
Fever (5%), eye surgeries (5%), and accidents (3%) also make substantial contributions to the overall claim volume. Although cancer accounts for approximately 1 per cent of claims, the per case cost is relatively high. Conversely, accidents, despite being frequent, have an average cost of Rs 33,000, which is lower than the overall average cost of claims.
More than 82% of required documents are submitted at the time of claim intimation. In 76% of cases, there are no deficiencies in the documents.
The report emphasized that the duration of hospitalization is a critical aspect of health insurance claims.
Typical hospitalization period is two days, but more than 21 per cent of hospitalizations extend beyond three days
“This underscores the necessity for comprehensive coverage that accounts for longer hospital stays,” said Kapil Mehta, founder of SecureNow
Additionally, day care procedures constitute 29% of all claims, highlighting the importance of including coverage for these procedures in health insurance policies, SecureNow said.
The report revealed that nearly 51 percent of insurance claims were assessed by private insurers.
The survey also revealed that insurance claims were made by policyholders not just for their own treatment, but also for the treatment of family members. Just 33 percent of the claims were made by policyholders for their own hospitalization expenses. The remaining 67 percent was for family members.
The cost of health insurance claims in India is high, but it is an important financial protection for individuals and families. The IRDAI report provides valuable insights into the cost of health insurance claims in India and the reasons for these claims. This information can help individuals and families to make informed decisions about their health insurance coverage.