As healthcare costs continue to surge, many individuals are facing rising premiums on their mediclaim policy along with a growing number of disputes around claims settlement. Whether you are a senior citizen trying to renew your health insurance policy, or a young policyholder dealing with partial claim rejections, knowing how to respond to these developments is essential. Fortunately, several strategies and legal options are available to help consumers manage these challenges more effectively.
Why health insurance premiums are rising
In recent years, the cost of medical treatment in India has climbed steeply. According to industry estimates, the average health insurance policy renewal premium increased by 10–15 percent in 2024 alone. The post-pandemic period saw insurers adjusting their pricing to reflect inflation in medical care, hospitalisation charges, and operational expenses.
A study by Policybazaar.com highlighted that while most policyholders saw modest hikes, around 5 percent experienced a surge of more than 30 percent, with some even witnessing increases up to 200 percent over a decade. Notably, senior citizens bore the brunt of these hikes, with some facing premium jumps of up to 100 percent.
IRDAI’s intervention for senior citizens
To provide relief, the Insurance Regulatory and Development Authority of India (IRDAI) issued guidelines in January 2025 capping annual premium hikes for senior citizens at 10 percent. The move was based on the recognition that the elderly often live on limited incomes and are disproportionately affected by steep revisions in premium rates.
IRDAI has also directed insurers to refrain from withdrawing existing health insurance policies for senior citizens and replacing them with more expensive plans without explicit regulatory approval. While this measure aims to protect consumers, concerns remain about the possibility of insurance companies bypassing the intent of the regulation by seeking approval to discontinue older plans.
Claim settlement: A growing concern
Aside from premium increases, the reliability of claim settlement has become another critical issue. According to the Insurance Brokers’ Association of India (IBAI), 11 out of 28 non-life insurers had a claim settlement ratio (by value) of less than 70 percent in 2022–23. This means that many insurers are either rejecting large claims or delaying their settlement.
A survey conducted by LocalCircles revealed that half of the respondents had experienced partial or total rejection of their claims between June and December 2024. Furthermore, the Insurance Ombudsman’s 2023–24 report noted that 95 percent of health insurance grievances were linked to disputes in claim settlement.
Common reasons for claim disputes
Some of the typical reasons for denied or reduced payouts under a mediclaim policy include:
- Incomplete documentation
- Delay in informing the insurer about hospitalisation
- Treatment falling outside the scope of coverage
- Hospital charges exceeding predefined package limits
- Non-disclosure of pre-existing illnesses
In some cases, even valid claims are partially settled or rejected due to misinterpretation of policy terms or lack of clarity in the fine print.
What policyholders can do to manage premium hikes
For younger and healthier policyholders, several strategies can help cushion the impact of premium hikes:
- Port your policy: If you find your current health insurance policy unaffordable, consider porting to another insurer that offers better benefits at lower premiums. Porting allows you to retain your accumulated benefits, such as the waiting period for pre-existing conditions.
- Opt for voluntary deductibles: Agreeing to pay a fixed amount out of pocket for each claim can reduce premiums significantly. For instance, a deductible of Rs 15,000 might reduce your premium by up to 15 percent.
- Limit your hospital network: Choosing a restricted list of hospitals within your insurer’s network can fetch you discounts on premiums, as these hospitals typically have negotiated rates.
- Pay long-term premiums: Paying your premiums for two or three years upfront can attract a discount ranging from 7.5 to 15 percent.
Steps to take in case of claim rejection
If your claim is denied or only partially settled under your mediclaim policy, it is essential to follow a structured approach:
- Contact the grievance redressal officer of your insurance company with a written complaint and supporting documents.
- If the issue remains unresolved for 30 days or the response is unsatisfactory, file a complaint with IRDAI through its Bima Bharosa portal.
- Approach the Insurance Ombudsman in your region. If mediation is possible, the matter can be settled within a month; otherwise, a formal award is made within three months.
- If none of the above channels provides a resolution, you may approach the consumer court, which handles service-related grievances.
Tips to reduce claim disputes
To minimise the chances of claim denial under a health insurance policy, policyholders should:
- Understand the scope, limitations, and exclusions in their policy.
- Notify the insurer immediately upon hospitalisation.
- Maintain records of all prescriptions, bills, and hospital documents.
- Clarify pre-approvals, especially for planned surgeries or treatments.
- Inform the insurer of any changes in medical condition or lifestyle.
Looking ahead: A need for policyholder awareness
As insurers reassess their pricing models and service efficiency, policyholders must also take an active role in understanding their policy terms and asserting their rights. Choosing the right mediclaim policy, comparing renewal benefits, and knowing the grievance redressal process can significantly reduce both financial and emotional stress.
While IRDAI’s interventions aim to protect consumers—especially vulnerable groups like senior citizens—there is still a long way to go in standardising healthcare costs and ensuring that insurers uphold a fair and timely claims process.
Conclusion
The challenges surrounding rising premiums and claim disputes underscore the importance of being proactive and well-informed when managing a health insurance policy. Whether it’s through strategic policy selection, negotiating deductibles, or escalating unresolved claims to the ombudsman or consumer courts, policyholders now have several tools at their disposal to navigate these complexities. With the right approach, individuals and families can still secure effective health coverage without compromising on affordability or service quality.
