Lok Sabha Question No. 150 (UNSTARRED), answered on 2025-02-03
Subject: Spikes in Health Insurance Premiums
Ministry: FINANCE
Asked by: Shri Ve Vaithilingam

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION No. 150

TO BE ANSWERED ON MONDAY, 3 FEBRUARY, 2025/ 14 MAGHA, 1946 (SAKA)

## SPIKES IN HEALTH INSURANCE PREMIUMS

231. Shri Ve Vaithilingam:

Will the Minister of Finance be pleased to state:

- (a)  whether  the  Insurance  Regulatory  and  Development  Authority  of  India  (IRDAI)  is keeping a close eye on the recent spikes in health insurance premiums across the industry;
- (b)  whether  the  Government  is  making  efforts  to  ensure  better  understanding  and  coordination  between  payers  (health  insurers)  and  healthcare  providers  (hospitals)  on medical treatment pricing;
- (c) if so, the details thereof; and
- (d) if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

(a) to (d):

IRDAI  has  informed  that  insurance  companies  design  and  price  the  health  insurance product based on Board approved underwriting policy of respective insurers, considering actuarial  principles  and  parameters  like  age,  morbidity  data,  inflation,  interest  rates, product  features  etc.,  for  determining  the  premium.  Further,  IRDAI  has  issued  'IRDAI (Insurance  Products)  Regulations,2024'  and  'Master  Circular  on  IRDAI  (Insurance Products) Regulations 2024-Health Insurance' which inter alia, stipulate that insurers will ensure  that  the  premium  rates  are  fair  and  not  excessive,  inadequate  or  unfairly discriminatory and provide value for money. Insurers are also required to provide wider choice by offering diverse insurance products catering to all ages, regions, occupational categories, medical conditions/ treatments, all types of hospitals and health care providers to suit the affordability of the policyholders/prospects.  Further, the insurers may reward the policyholder for claim free year by giving an option at the time of renewal of policy to choose  the  'No  Claim  Bonus'  either  by  increasing  the  sum  insured  or  decreasing  the premium amount.

To ensure better understanding and co-ordination between payers (health insurers) and healthcare providers (hospitals) and to provide seamless claims experience to customers in  a  cost-effective  manner,  IRDAI  has  issued  Master  Circular  on  IRDAI  (Insurance Products) Regulations,2024 which provides that all the insurers shall have in place board approved policy on quality standards and benchmarks for empanelment of Hospitals and Health Care Providers. Insurers along with the Insurance Councils are advised to have in place  common  empanelment  of  hospitals/healthcare  providers  and provide  seamless journey to the policyholder at each point of sale, service and claim. Insurance companies are mandated to display the list of their tie-up hospitals/healthcare service providers on their website and specifically indicate that reimbursement of claim will have to be filed with the  insurer  if  the  policyholder  avails  services  in  other  hospitals/healthcare  service providers. Further, all insurance companies have on-boarded the National Health Claim Exchange,  an  initiative  of  Ministry  of  Health  and  Family  Welfare,  intended  to  enable standardized  and  faster  health  insurance  claim  processing,  enhance  efficiency  in  the insurance industry and improve the patient experience.

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