Avg health insurance claims in India Rs 42,000; 15% cross Rs 1 lakh: Report

The average cost of health insurance claims in India is Rs 42,000, with 15 per cent of these claims exceeding Rs 1 lakh, a report said. 

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.

The report by SecureNow on Reimbursement Health Insurance Claims provides significant findings on hospitalization duration, claim costs, settlement rates, and the efficiency of the claim settlement process in India.

It analysed 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 Third Party Administrators (TPAs).

Furthermore, it said, less than 3 per cent of claims are due to accidents, with a lower median cost of Rs 33,000.

The report emphasizes that the duration of hospitalization is a critical aspect of health insurance claims, according to SecureNow Insurance Broker, co-founder, Kapil Mehta.

The comprehensive study reveals that the typical hospitalization period is two days, but more than 21 per cent of hospitalizations extend beyond three days, he said.

"This underscores the necessity for comprehensive coverage that accounts for longer hospital stays," he added.

The report also indicates relatively high claim settlement rates, with over 50 per cent of claims having 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 per cent), eye surgeries (5 per cent), and accidents (3 per cent) 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.

Commenting on National Insurance Awareness Day ICICI Lombard General Insurance Company managing director Bhargav Dasgupta, "We recognize the crucial mission of increasing insurance penetration in India. In a nation brimming with potential and opportunities, awareness and understanding of insurance play a paramount role."

The visionary reforms set in motion by IRDAI have brought forth transparency, consumer-centric practices and accessibility- ultimately fostering trust, he said.

On the ocassion of Insurance Awareness Day Sanjiv Bajaj, Managing Director of Bajaj Capital said factors influencing insurance purchase decisions are of paramount importance and affordability of premiums plays a significant role.