Health insurance complaints rise 41% on claims disputes in FY25: Irdai

Regulator asks insurers to conduct 'root-cause analysis' of complaints and improve oversight of agents, brokers and digital channels

Complaints about health insurance policies increased 41 per cent to 1,37,361 in FY25 from the previous year, according to the insurance regulator’s annual report that listed disputes about claims, delays and incomplete settlements as the biggest issues.

 

As many as 97,503 complaints were made in FY24, according to the Insurance Regulatory and Development Authority of India (Irdai). There were 1,20,429 complaints about life insurers in FY25, taking total insurance sector grievances to 2,57,790. [Add FY24 figures here]

 

Nearly seven out of 10 complaints in the general and health segments were about:

• Claims refusal
• Delays in settlement
• Partial claim payments
• Document disputes

 

Such complaints make claims, not purchase, the weakest link in the insurance value chain for many customers.

 

 

Health insurance, unlike life cover, can generate multiple claims within a single policy year. That increases touchpoints between insurer, hospital and customer, and raises the probability of disagreement over admissibility and billing.

 

Complaints about standalone health insurers increased 33 per cent to 46,151 in FY25.

 

Health insurance grievances surged across sectors, with major private firms hitting double-digit growth while some public insurers saw complaints more than double year-on-year.

 

Why friction is rising

 

Industry data shows that medical inflation and hospital billing are key reasons for complaints. In many cases, aggregate claim outgo in health portfolios is running above premium collections, putting pressure on underwriting margins. That often translates into stricter claim checks and higher rejection or deduction rates.

 

Another friction area is cashless treatment. Disputes frequently arise when:

 

• Hospital bills exceed insurer package rate.
• Exclusions are discovered at the claim stage
• Pre-authorisation approvals are revised

 

Life insurance complaints show different pattern

 

In contrast, life insurance grievances are concentrated less around death claims and more around:

 

• Survival and maturity benefits
• Policy servicing
• Unfair sales practices
• Regulator flags mis-selling risk

 

Irdai identified mis-selling and wrong product recommendations as a continuing concern. Insurers have been directed to conduct “root-cause analysis” of complaints and improve oversight of agents, brokers and digital channels.

 

For policyholders, the data underlines a practical takeaway — claim terms, exclusions, room rent limits and sub-limits matter as much as the premium when choosing a health policy.