Health insurance is meant to act as a financial safety net when a person or family faces a serious medical event. People buy health insurance plans with the expectation that, when needed, claims will be settled fairly and on time. Recent comments by the Insurance Regulatory and Development Authority of India (IRDAI) chairman, Ajay Seth, show that there is progress, but also some important gaps in how claims are finally paid. According to the chairman, insurers are settling a large number of health claims in terms of count.
What Did IRDAI Highlight?
In his recent remarks, Chairman Seth explained that there are two separate realities that must be viewed together. On one side, health insurance companies and general insurers are processing crores of claims every year and paying very large total amounts in rupees. On the other side, complaints from policyholders about claim deductions, partial payments, and delays are still rising.
The key point he raised is that a high number of “claims settled” on paper does not automatically mean policyholders are satisfied. Many people feel that their claim was not paid in full or that deductions were not clearly explained. This is why IRDAI has started to monitor not only how many claims are settled, but also how completely they are settled and how policyholders experience the process.
Why Might Claim Amounts Fall Short?
There are several reasons why a claim may not be paid in full, even when the policy is genuine and the claim is accepted. One common reason is the difference between hospital charges and the limits set in the policy. For example, if a policy has a room rent limit or a specific package rate and the hospital charges more, the extra amount often has to be borne by the policyholder.
Another reason is the presence of sub‑limits on certain procedures, consumables, or non‑medical items. Health insurance plans for family might cover a surgery but cap certain associated expenses, leading to out‑of‑pocket costs. There can also be disagreements between insurers and hospitals over package rates, treatment protocols, or documentation. All of these factors can reduce the final amount paid, even if the claim is technically “settled.”
The Regulator’s Expectations of Insurers
Chairman Seth’s comments make IRDAI’s expectations clear. Insurers are expected to handle claims in a prompt, fair, and transparent manner. This means that decisions on approvals, deductions, and rejections should be taken and communicated clearly within reasonable timeframes. It also means that policyholders should understand why a certain amount has been approved and why some parts have not been paid.
IRDAI has also emphasised that grievance redressal within insurance companies needs to be strong. Internal complaint systems should not be seen as formalities but as active tools for identifying patterns, correcting issues, and preventing similar problems in the future.
How to Reduce The Risk of Unpleasant Surprises
Policyholders can take a few practical steps to reduce the gap between expectation and reality. The first step is to read the policy brochure and key terms carefully before purchase. Pay attention to room rent limits, sub‑limits, exclusions, waiting periods, and conditions for specific diseases or procedures. This may take some time, but it sets realistic expectations and helps avoid shock at the time of a claim.
The second step is to choose hospitals that are part of the insurer’s network whenever possible. Cashless treatment at network hospitals usually follows agreed‑upon packages or rates, which can reduce disputes over costs. If you are buying health insurance for family, check whether the hospitals you trust are included in the network.
The third step is to keep documentation organised. Proper medical records, prescriptions, reports, and bills speed up claim processing and give the insurer less reason to question the details. During treatment, it also helps to ask the hospital for estimates and clarifications so that you know in advance which parts may not be covered.
How Insurers Respond
Online tools make it easy to compare broad features of different policies. A health insurance premium calculator can give you a quick idea of how much you might need to pay for different sums insured, ages, and add‑ons.
Different companies respond to regulatory expectations in different ways. For example, some insurers emphasise clear communication, wide hospital networks, and family‑focused product design. HDFC ERGO highlights that its family health insurance is built around emerging family needs, supported by a large cashless network, and long experience in the Indian insurance market.
Wrapping Up
The message from IRDAI’s chairman is not that the system is failing, but that there is room for meaningful improvement. Large numbers of claims are being settled, and many policyholders are receiving genuine support. When both sides move in this direction, the best health insurance plans become not just contracts, but dependable tools that support families during some of their most challenging moments.