Star Health, CARE, Niva Bupa record most policyholder complaints in FY24

Policyholder grievances against health insurers jumped 21.7% in FY24, with Star Health leading by a wide margin, followed by CARE and Niva Bupa, Ombudsman data shows.

If you have ever faced hurdles in getting your health insurance claim settled, you are not alone. The Insurance Ombudsman’s latest annual report for 2023-24 shows that policyholders continue to raise thousands of complaints against insurers, with a handful of companies consistently attracting the maximum grievances.

Star Health tops the list

 

The data shows Star Health & Allied Insurance received the highest number of complaints – 13,308 in FY24, of which more than 10,000 were related to partial or complete claim rejections. This figure alone is more than the combined complaints against the other four insurers among the top five. 

Responding to the report, a senior official of Star Health and Allied Insurance, told Business Standard that the higher complaint volume reflects the nature of its business mix.   “With nearly 90 per cent of our business coming from the retail segment, unlike many health insurers who have a larger share of group business, we see a proportionately higher volume of customer interactions and related feedback,” he explained.

 

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Top 5 health insurance company with most complaints

 

1.      Star Health & Allied Insurance - 13,308

 

2.      CARE Health Insurance-  2,511

 

3.      Niva Bupa Health Insurance - 2,511

 

4.      National Insurance - 2,196

 

5.      New India Assurance - 1,602

 

 Complaints per policyholder

 

The report also adjusts complaints to the customer base. On this yardstick, Star Health again led with 63 complaints per one lakh policyholders, far higher than its peers. Niva Bupa and CARE Health followed with 17 and 16 complaints per lakh policyholders respectively, while public sector insurers fared much better, National Insurance had just 5 and New India only 1 complaint per lakh policyholders.  ALSO READ | How to Claime health insurance from multiple companies

Most disputes on claim repudiation

 

According to the Ombudsman, a majority of complaints fell under Rule 13(1)(b) of the Insurance Ombudsman Rules, 2017, which covers disputes on partial or total repudiation of claims. Star Health again led here with over 10,000 such cases, followed by CARE (2,393) and Niva Bupa (1,770).

Awards in favour of policyholders

 

When the Ombudsman decides in favour of a customer, the ruling may be a non-binding recommendation or a binding award. In FY24, Star Health was directed to pay compensation in 7,506 cases, amounting to over Rs 6 billion, CARE Health, Niva Bupa and National Insurance also featured prominently in this list.

Rising trend in health insurance complaints

 

Overall, health insurance-related complaints rose 21.7 per cent year-on-year, even as grievances in life and general insurance declined. Out of the total complaints received by the Ombudsman, private health insurers accounted for a large majority, highlighting persistent customer dissatisfaction in this segment.

 

With the Irdai’s plan to introduce an internal ombudsman within each insurer from 2025, policyholders may get faster redress for disputes up to Rs 5 million. However, questions remain about independence, since these officers will report to the insurer’s top management.