Latest News on Star Health And Allied Insurance
Insurers to charge 18% GST on agents’ commission, Input Tax Credit issue
The Indian government’s decision to reduce the Goods and Services Tax (GST) on health insurance premiums from 18% to 0% has had an unintended consequence on the insurance industry. Insurers are now imposing an 18% GST on commissions paid to agents and distributors to offset losses from the withdrawal of input tax credit (ITC). This move has come as a major blow to insurance intermediaries across the country.
The GST cut means that insurers can no longer claim ITC on commissions, rewards, and other corporate expenses such as rent, technology, and manpower. As a result, insurers are passing on the GST cost to agents and distributors, which could squeeze smaller distributors and individual agents. For example, if the commission for a sale is Rs 100, the amount payable will reduce by 18% to Rs 84.74.
Industry experts warn that this new structure could make health insurance distribution less profitable or unviable for many agents, unless companies revise commission structures or offer alternative incentives. While customers may gain marginally from lower premiums, the ripple effects are being felt sharply across the industry. Insurers face higher operating costs, and distributors face lower earnings.
The problem stems from how the GST framework treats exemptions. For a company to claim input tax credit, there must be a GST component on its output. With the health insurance sector’s GST set to nil, insurers lose this offset mechanism, and expenses on rent, IT systems, advertising, outsourcing, and agent commissions will add up as unrecoverable costs.
Several insurance companies, including Aditya Birla Health Insurance, Care Health Insurance, Star Health Insurance, and ICICI Lombard General Insurance, have acknowledged the challenge and are passing on the GST cost to distributors. They have reiterated their commitment to passing on the entire GST benefit to customers, but noted that the exemption benefits customers while simultaneously increasing operational costs for insurers. The companies have stated that they will absorb the impact of GST on expenses, but will pass on the GST on commissions to distributors to maintain equilibrium and protect customer interests.
Top Insurers With Maximum Grievances Revealed By Insurance Ombudsman: All You Need To Know
The Council of Insurance Ombudsman Annual Report 2023-24 has revealed a significant rise in complaints against health insurance companies in India. The report shows that the total number of complaints against health insurance companies increased by 21.7% in FY 2023-24, with 31,490 complaints, compared to 25,873 in FY 22-23. Private insurers accounted for the majority of complaints, with 26,064 grievances, while public sector insurers had 5,298 complaints.
Star Health & Allied Insurance topped the list with the highest number of complaints, with 13,308 grievances, of which 10,196 were related to claim repudiations. Other top insurers with high complaint numbers included CARE Health Insurance, Niva Bupa Health Insurance, National Insurance, and New India Assurance. The report also highlights that claim repudiation is the most common grievance, with the majority of complaints falling under this category.
The Insurance Regulatory and Development Authority of India (IRDAI) has responded to the rising dissatisfaction by mandating every insurer to appoint an Internal Ombudsman (IO) to review cases up to Rs 50 lakh that remain unresolved after 30 days or are rejected by insurers. However, experts argue that the independence of the IO is questionable since they report to the insurer’s top management, which may raise concerns about fairness and impartiality.
The report emphasizes the need for stronger accountability, transparency, and consumer protection in the health insurance sector. Policyholders are advised to look beyond premiums when buying health insurance and consider critical factors such as claim settlement ratio, repudiation rates, grievance redressal track record, and customer service quality. The IRDAI’s initiative to appoint an Internal Ombudsman is a step towards addressing the rising complaints, but its effectiveness and independence remain to be seen.
The Council for Insurance Ombudsmen (CIO) plays a crucial role in providing an alternative grievance redressal platform for policyholders. The CIO functions under the IRDA Act, 1999, and the Redressal of Public Grievances Rules, 1998, and is designed to provide a speedy and cost-effective mechanism to resolve disputes against insurance companies, intermediaries, or brokers. The report highlights the need for informed choices and stronger regulation to restore policyholder trust in the health insurance sector.
Health insurers fuel non-life premium growth due to GST benefits.
The non-life insurance industry in India experienced a significant boost in December, with a 14% year-on-year increase in gross direct premium collections, reaching ₹28,446.82 crore. This growth is the second-strongest monthly expansion in the industry, following a substantial 24.2% jump in November. The main driver behind this surge was the performance of standalone health insurers, which reported a 39% year-on-year rise in premiums, reaching ₹4,260.10 crore. Star Health and Allied Insurance, the largest player, saw its premiums climb 24% to ₹1,712 crore.
The growth in the health segment can be attributed to the government’s decision to exempt GST on individual health insurance policies, making them more affordable and stimulating demand. Public sector general insurers also demonstrated healthy growth, with a 15% increase in gross premium collections to ₹10,126.36 crore. National Insurance reported a 37% surge in premium income to ₹1,520.36 crore. Private players, including ICICI Lombard and HDFC Ergo General Insurance, also contributed significantly to the growth, with a 15% year-on-year increase in gross direct premiums to ₹13,621.42 crore.
The outlook for the non-life insurance industry remains positive, with brokerage firm Emkay Global anticipating continued healthy growth in the December 2025 quarter. The growth is expected to be driven by strength in both the motor and health insurance segments. The retail health segment is poised for robust expansion, directly benefiting from increased affordability following GST exemptions. Additionally, growth in motor insurance is likely to be driven by strong new-vehicle sales, potentially aided by prior GST rate adjustments. Overall, the non-life insurance industry in India is expected to continue its growth momentum, driven by increasing demand for health and motor insurance products. With the government’s support and growing awareness among consumers, the industry is likely to experience sustained growth in the coming months.
From Commissions to Care, ETHealthworld
The Indian health insurance industry is experiencing rapid growth, with increasing premiums and a rising number of policyholders. However, beneath the surface, there are concerns that the system is becoming inefficient and prioritizing profits over patient care. The Medical Loss Ratio (MLR), which measures the percentage of premiums spent on patient claims, is a key indicator of an insurance system’s efficiency. In India, the MLR is alarmingly low, with some companies spending as little as 58% of premiums on medical care.
An analysis of the financial disclosures of standalone health insurance companies in India reveals that a significant portion of premiums is being absorbed by commissions, administration, and management overhead. For example, Star Health Insurance spent 15% of premiums on commissions and 17% on management expenses, while Care Health Insurance spent 20% on commissions and 22% on management expenses. This leaves a relatively small amount for actual medical care.
In contrast, global benchmarks suggest that at least 80-85% of premiums should be spent on patient care. In countries like the US, Germany, France, and the Netherlands, regulatory measures are in place to ensure that administrative and sales costs are capped, allowing the bulk of contributions to flow towards treatment.
The Indian health insurance industry’s focus on selling policies rather than funding care has led to a breakdown of trust between customers, hospitals, and insurers. Patients are often forced to pay out of pocket or battle for approvals, despite paying rising premiums. To address this issue, regulators must set MLR thresholds, forcing insurers to spend at least 80-85% of premiums on patient care. Additionally, costs of customer acquisitions and management expenses must be reduced to single digits.
The article concludes that the Indian health insurance industry needs to shift its focus from aggressively selling policies to transparently funding care. Unless efficiency improves and regulations enforce higher MLR thresholds, the promise of health insurance will remain unfulfilled, leaving patients and hospitals short-changed. The industry must prioritize funding healthcare over corporate profits and move towards a more transparent and patient-centric model.
AHPI seeks immediate restoration of cashless services by Star Health
The Association of Healthcare Providers of India (AHPI) has appealed to Star Health and Allied Insurance to reinstate cashless services at their member hospitals. This decision comes after the insurance company suspended these facilities, resulting in growing distress and inconvenience for patients. Several prominent hospital chains and tertiary care centers have been affected, including Care Hospitals, Manipal Hospitals, Max Hospitals, and Medanta Hospital, among others.
The AHPI has also highlighted the issue of delays or refusals in empaneling new hospitals, which restricts patient choice and forces them to opt for reimbursement claims instead of cashless treatment. This defeats the purpose of health insurance, which patients buy with the expectation of receiving cashless treatment at quality hospitals. According to Girdhar Gyani, Director General of AHPI, and Abul Hasan, Chairman of the Indian Medical Association Hospital Board, it is unjust for insurers to withhold cashless facilities after collecting premiums.
The AHPI has demanded that cashless services be restored immediately and that the empanelment of new hospitals be expedited to ensure uninterrupted access to healthcare. The association has clarified that its decision is a response to Star Health’s actions and not a unilateral move, as suggested by the General Insurance Council (GIC). The AHPI remains open to engagement with stakeholders but has emphasized that protecting patient welfare must remain the top priority.
The suspension of cashless services has significant implications for patients, who may be forced to bear the financial burden of medical treatment out of pocket. The AHPI’s appeal highlights the need for insurance companies to prioritize patient welfare and ensure that policyholders receive the benefits they are entitled to. By reinstating cashless services and expediting empanelment, Star Health and Allied Insurance can help alleviate the distress and inconvenience caused to patients and restore trust in the healthcare system. Ultimately, the AHPI’s efforts aim to ensure that patients have access to quality healthcare without financial hardship.
Stock Market Updates for Star Health And Allied Insurance
Recent Updates
The latest claim settlement ratio of health and general insurance companies was released by IRDA in 2025. According to the data, Navi and Acko have taken the lead, while Star Health and Zuno have fallen below the 90% mark.
The rising medical inflation has made it challenging for individuals to bear medical expenses without a comprehensive health insurance policy. In India, the Insurance Regulatory and Development Authority (IRDAI) releases an annual list of claim settlements by health and general insurance companies. The claim settlement ratio, which refers to the percentage of claims paid or settled by an insurer, is a reliable way to assess an insurer’s efficiency.
According to the latest figures for 2023-2024, the general insurers paid out a total of 71,200,854 claims, with 81.13% of total claims paid within 3 months of claim intimation. Among private general insurers, Acko General Insurance and Navi General Insurance Ltd led with claim settlement ratios of 99.91% and 99.97%, respectively. Zuno General Insurance Co. Ltd had the lowest claim settlement ratio among private sector insurers, with 83.12% of claims paid within 3 months.
Among public insurers, The Oriental Insurance Co. Ltd had the lowest claim settlement ratio, with only 65.08% of claims paid within 3 months. United India Insurance Co. Ltd had the highest claim settlement ratio among public insurers, with 96.33% of claims paid within 3 months.
For stand-alone health insurers, Aditya Birla Health Insurance Company had the highest claim settlement ratio within 3 months, at 92.97%. Care Health Insurance and Niva Bupa Health Insurance followed closely, with claim settlement ratios of 92.77% and 92.02%, respectively. Star Health and Allied Insurance Co. Ltd had the lowest claim settlement ratio among stand-alone health insurers, with 82.31% of claims paid within 3 months.
While checking the claim settlement ratio is necessary, it should not be the sole basis for finalizing a health or general insurance company. Other factors such as the sum insured, waiting period for various illnesses, and network of hospitals offered should also be considered.
The IRDAI data also reveals that during 2023-24, 16.3% of total claims were paid out between 3-6 months, indicating that some insurers may have delayed claim settlements. It is essential for policyholders to review the claim settlement ratio and other factors before selecting an insurer to ensure they receive adequate and prompt financial assistance in case of medical emergencies.
Overall, the claim settlement ratio is a crucial factor in assessing an insurer’s efficiency, and policyholders should carefully evaluate this metric along with other factors before making an informed decision. By doing so, they can ensure that they have a comprehensive health insurance policy that provides them with the necessary financial protection in case of medical emergencies.
Star Health under IRDAI scrutiny over health insurance claim settlement practices
The Insurance Regulatory and Development Authority of India (IRDAI) has discovered significant lapses in the claim settlement practices of Star Health and Allied Insurance, a stand-alone health insurer. The regulator is likely to take action against the company, although official investigations are still ongoing. IRDAI has also scrutinized 8-10 other general and health insurers, but no action has been reported against them. The regulator examined various claim-related aspects, including the number of claims repudiated and accepted, deductions, and queries raised by policyholders.
According to IRDAI’s handbook of insurance statistics, Star Health’s incurred claim ratio for the year 2023-2024 was 66.47%, which means that for every Rs 100 collected as premiums, the company paid approximately Rs 67 towards honoring policyholder claims. This is marginally higher than the total incurred claim ratio of stand-alone health insurers, but significantly lower than the cumulative incurred claim ratio for all health and general insurers.
Star Health also recorded the lowest claim settlement ratio within 3 months among all stand-alone health insurers, at 82.31% for the year 2023-24. The company repudiated or rejected 2,96,356 claims between 2023-24, which is significantly more than other insurers in the same category. Additionally, Star Health received the maximum number of complaints during the year, at 16,804, which is the highest amongst all general and health insurers in the country.
In response to the allegations, Star Health stated that they have not received any communication from IRDAI on this matter and that they are committed to a customer-centric approach. The company claimed that IRDAI’s audits and inspections are a routine process to ensure compliance across the industry and that the media statement appeared to be speculative and motivated in nature.
The findings of IRDAI’s investigation have raised concerns about Star Health’s claim settlement practices and its commitment to policyholders. The company’s low incurred claim ratio and high number of claim rejections and complaints suggest that it may not be honoring its policyholders’ claims in a fair and timely manner. As a result, IRDAI’s potential action against Star Health could have significant implications for the company and its policyholders.
Non-life insurers record 2% premium growth in September, Bajaj Allianz General Insurance leads the way
The non-life insurance sector in India has reported a modest 1.94% year-on-year growth in gross direct premium to Rs 23,430 crore in September. This growth was driven primarily by an increase in standalone health insurance premiums. The largest general insurer, New India Assurance, saw a 3.5% rise in premiums, while ICICI Lombard General Insurance reported a 6.2% increase. Other state-owned insurers, such as United India Insurance and Oriental Insurance, also reported significant growth, with increases of 23.36% and 4.45%, respectively.
Private general insurers, including Bajaj Allianz General and HDFC Ergo, also reported varying degrees of growth, with Bajaj Allianz General seeing a 31.35% increase and HDFC Ergo experiencing a decline of 3.78%. Standalone health insurers, such as Niva Bupa Health Insurance and Star Health and Allied Insurance, reported growth of 1.45% and 3.36%, respectively.
The government’s recent clarification on Goods and Services Tax (GST) has also had an impact on the industry. Premiums for individual life and health insurance policies are now exempt from GST, making them more affordable for individuals and families. However, this exemption does not apply to group insurance policies, which are typically offered by employers to their employees. Reinsurance services, which insurers purchase to protect themselves, are also exempt from GST.
However, insurers will face a significant adjustment regarding Input Tax Credit (ITC). They will no longer be able to claim ITC for essential input services such as agent commissions, brokerage, and administrative services. This change may have a significant impact on the industry, as insurers will need to adjust their business models to account for the loss of ITC. Overall, the non-life insurance sector is experiencing moderate growth, driven primarily by increases in standalone health insurance premiums, and is adapting to changes in the tax landscape.
AHPI issues notice to Star Health Insurance, warns of suspension of cashless services from September 22, 2025 – Express Healthcare
The Association of Healthcare Providers India (AHPI) has issued a notice to Star Health Insurance, warning of a potential suspension of cashless services starting from September 22, 2025. This move is likely a result of unresolved issues between the two parties, although the specific reasons behind the notice are not explicitly stated.
As a representative body of healthcare providers, AHPI plays a crucial role in facilitating cashless services for patients with insurance coverage. Cashless services enable policyholders to receive medical treatment without having to pay out-of-pocket expenses, as the insurance company directly settles the bills with the healthcare provider.
The suspension of cashless services would significantly impact policyholders, causing inconvenience and potential financial hardship. Patients may be required to pay for medical expenses upfront and then submit claims for reimbursement, which could lead to delays and additional administrative burdens.
It is essential for Star Health Insurance and AHPI to resolve their differences and find a mutually beneficial solution to avoid disrupting cashless services. The suspension of these services could damage the reputation of both parties and erode trust among policyholders.
In the interests of patients and healthcare providers, it is crucial for insurance companies and healthcare associations to maintain a collaborative and efficient relationship. This includes ensuring timely payments, transparent communication, and fair reimbursement rates.
The notice issued by AHPI serves as a warning, allowing Star Health Insurance time to address the concerns and work towards a resolution. If the issues are not resolved, the suspension of cashless services could have far-reaching consequences for the entire healthcare ecosystem.
As the deadline of September 22, 2025, approaches, it is essential for both parties to engage in constructive dialogue and find a solution that benefits all stakeholders, including policyholders, healthcare providers, and the insurance company itself. The outcome of this situation will be closely watched, as it may have implications for the broader healthcare and insurance industries.
Healthcare providers’ body demands immediate restoration of cashless services by Star Health Insurance
The Association of Healthcare Providers (AHPI) has suspended cashless services in several hospitals across India, including prominent chains like Care Hospitals, Manipal Hospital, and Max Hospitals, among others. This move is in response to a dispute with Star Health Insurance, one of the leading health insurance companies in the country. AHPI claims that Star Health has been taking “arbitrary” actions, such as de-empanelling hospitals and withdrawing cashless services, which has prompted the association to take this step.
However, the General Insurance Council (GIC) has come out in support of Star Health, stating that AHPI’s actions are “unilateral” and “unwarranted”, and could undermine trust in the health insurance ecosystem. The GIC has expressed concern that these actions could prejudice the interests of policyholders.
Star Health has also issued a statement denying that it has received any notice of cashless suspension from its network partners. The company has accused AHPI of issuing threats and creating unnecessary confusion among policyholders. Star Health has reassured its customers that their access to healthcare will remain unaffected and that they will ensure claim payments are made even in the event of a disruption.
The dispute between AHPI and Star Health has sparked a war of words, with both parties accusing each other of taking arbitrary actions. The situation has created uncertainty among policyholders, who are concerned about their access to cashless services at hospitals. The General Insurance Council has urged both parties to resolve their differences and find a solution that does not harm the interests of policyholders. The government’s efforts to promote healthcare as a basic necessity by exempting GST on health insurance may be undermined by this dispute, which highlights the need for greater transparency and cooperation between healthcare providers and insurance companies.
Rising Health Insurance Complaints in India: Key Data Insights
Complaints against health insurers in India are on the rise, indicating growing consumer awareness and the importance of effective grievance redressal mechanisms. According to Insurance Samadhan, a grievance platform, there was a 45% increase in complaints in Q2 2025 compared to the previous quarter, with 974 cases involving claims worth over ₹119 crore. The majority of these grievances (67.5%) related to health insurance, followed by life insurance (25.5%) and general insurance (6.9%). Endowment policies were the most commonly mis-sold products, often leaving policyholders with reduced returns or penalties.
The Council of Insurance Ombudsman (CIO) data for FY2023-24 provides further insight into the sector’s challenges. The ombudsman received the highest number of complaints against Star Health & Allied Insurance, with 13,308 cases, mostly regarding partial or complete claim rejection. Other insurers with high complaint volumes included CARE Health Insurance, Niva Bupa, and public sector insurers National Insurance and The New India Assurance. Star Health’s complaint volume was significantly higher than its peers, with 63 complaints per lakh policyholders.
Experts attribute the high complaint volume to mis-selling, driven by aggressive agent commissions and sales targets. Many consumers are sold unsuitable policies, which can lead to higher premiums or outright rejections due to pre-existing conditions. The data highlights the need for consumers to proactively evaluate their coverage and understand complaint mechanisms to ensure adequate protection. Additionally, the trend of Indians first experiencing insurance through employer-provided group health policies, and then purchasing retail policies triggered by claims or life events, emphasizes the importance of early adoption and careful policy selection.
The increasing complaints against health insurers in India underscore the need for improved grievance redressal mechanisms and consumer awareness. As the insurance sector continues to grow, it is essential for consumers to be aware of their rights and options for resolving disputes. By understanding the common issues and challenges in the sector, consumers can make informed decisions and ensure they have adequate protection. Ultimately, the rising complaints against health insurers in India highlight the need for a more transparent and consumer-centric approach to insurance sales and claims settlement.
Sharp premium drop hits general insurers in August; New India Assurance down 47% MoM
The Indian insurance sector experienced a decline in premium collections in August, with several leading insurers reporting sharp drops on a month-on-month (MoM) basis. In the general insurance segment, New India Assurance saw the steepest decline, with premiums falling 47% MoM to ₹2,197 crore. However, the company attributed this drop to the timing of policy receipts, citing the receipt of a quarterly installment of a government health policy in the previous month. Despite this, New India Assurance reported an 8.67% growth in premiums on a year-on-year (YoY) basis and a 14.66% growth up to the month on a YoY basis.
Other insurers also reported declines in premium collections. ICICI Lombard saw a 12% MoM decline in premiums to ₹2,182 crore, while Go Digit General Insurance registered a 16% MoM drop to ₹738 crore. Health insurers Niva Bupa Health Insurance and Star Health Insurance also reported contractions, with premiums declining 4% and 6% MoM, respectively.
This decline comes after a period of steady expansion in the insurance sector, with many insurers reporting strong inflows in July. In fact, New India Assurance, ICICI Lombard, Go Digit, Niva Bupa, and Star Health all posted double-digit MoM growth in July, highlighting a sharp contrast with the August figures. The decline in premium collections may be a temporary blip, and the sector is expected to continue growing in the long term. The insurance sector’s performance is closely watched, as it is a key indicator of the overall health of the economy. The decline in August may be attributed to various factors, including seasonal fluctuations and changes in policy receipts. However, the sector’s growth on a YoY basis suggests that it is still on a positive trajectory.
HDFC Ergo and Tata AIG have joined other insurers in reducing distributor commissions.
The Indian government has introduced a significant change in the Goods and Services Tax (GST) on individual health and life insurance premiums, reducing it from 18% to 0% effective September 22, 2025. However, this change also means that insurance companies can no longer claim Input Tax Credit (ITC) on services such as brokerage and commission for individual health and life insurance. As a result, insurance companies are reducing commission payouts to distributors to absorb the loss of ITC benefit.
Several major insurance companies, including HDFC Ergo General Insurance, Tata AIG General Insurance, ICICI Lombard General Insurance, Aditya Birla Health Insurance, Niva Bupa Health, Star Health, and Care Health, have already cut commissions to distributors. The commission paid to distributors is now inclusive of 18% GST, effective October 1, 2025. This change is expected to impact the profitability and operating expenses of insurance companies.
The government’s intention behind this move is to make insurance policies more affordable for individuals. However, it has created pressure on insurance companies’ margins, as they have lost the benefit of ITC that they could earlier claim on their expenses. Insurance companies are now absorbing the ITC disallowance impact on non-commission costs to keep premiums affordable for customers.
The reduction in commission payouts to distributors may affect their earnings, but insurance companies are encouraging them to focus on selling more policies to increase their volumes and earnings. The new guidelines have created a challenging environment for insurance companies, and they are awaiting responses from relevant authorities to address their concerns. Meanwhile, insurance companies are revising their commission rates to align with the GST changes, and distributors can expect updated commission grids soon. Overall, the GST exemption on individual health and life insurance premiums has created a complex situation for insurance companies, distributors, and policyholders, with both positive and negative implications.
Insurance premium collections rose in August, driven by Bajaj Allianz and New India Assurance.
The Indian general insurance sector experienced modest year-on-year growth in premium collections for August, according to data from the General Insurance Council. However, several major players reported significant sequential declines in premiums compared to July.
ICICI Lombard General Insurance saw a 2.1% year-on-year increase in gross direct premium underwritten, reaching ₹2,182 crore. Nonetheless, its premiums dropped 12% compared to the previous month. New India Assurance reported an 8.7% annual increase, with premiums totaling ₹2,197 crore, but experienced a substantial 47% month-on-month decline, the steepest among major insurers.
Star Health and Allied Insurance’s premium rose 1.9% year-on-year to ₹1,426 crore. In contrast, Go Digit General Insurance achieved a 13.6% annual jump, with premiums reaching ₹738 crore, but slipped 16% on a sequential basis. Bajaj Allianz General Insurance posted the strongest annual growth, with premium collections up 18.8% year-on-year at ₹2063.2 crore.
The declines in premiums for several major insurers may indicate a slowdown in the Indian general insurance sector. The significant drop in premiums for New India Assurance, in particular, may be a cause for concern. Despite the year-on-year growth, the sequential declines suggest that the sector may be experiencing a temporary downturn.
Overall, the data from the General Insurance Council highlights the mixed performance of Indian general insurers in August. While some insurers reported strong annual growth, others experienced substantial sequential declines. The sector’s performance will be closely watched in the coming months to determine if the declines are a one-time phenomenon or a sign of a larger trend. The Indian general insurance sector will need to adapt to changing market conditions to maintain growth and stability.
A consumer panel in Chandigarh has ordered an insurance company to pay Rs 25 lakh to a policyholder for unjustly denying a claim.
The District Consumer Disputes Redressal Commission-I in Chandigarh has ordered Star Health and Allied Insurance Company to pay Rs 25 lakh to the heirs of a deceased policyholder, Sarita Dutta alias Sarita Sharma, whose medical claim was wrongly repudiated. The policyholder had purchased a health insurance policy from Star Health in 2018 for a sum of Rs 25 lakh, which was renewed annually until 2023. In 2024, she was diagnosed with cancer and underwent medical treatment before passing away on September 6, 2024.
The insurance company rejected the claim and cancelled the policy, citing non-disclosure of a prior ovarian cyst surgery conducted in 2017. However, the complainants’ counsel argued that the surgery had revealed a benign cystadenoma with no evidence of malignancy, and that the company had wrongly repudiated the claim after five years of continuous renewals, violating IRDAI regulations.
The Commission found that the insurer’s repudiation was unjustified, as the 2017 medical records indicated the absence of cancer or malignancy. The Commission also observed that the IRDAI regulations prohibit contesting health policies after a 60-month “moratorium period” except in cases of established fraud. Since the policy had been in force for over six years, the Commission ruled that the insurance company’s actions violated these provisions.
The Commission directed the company to pay Rs 25 lakh as the insurance amount, along with Rs 25,000 as litigation cost and compensation. The order stated that the claim was wrongly repudiated by the insurance company by misinterpreting the terms and conditions of the policy, amounting to deficiency in service and unfair trade practice. This ruling upholds consumer rights in insurance matters and highlights the importance of insurance companies adhering to regulatory provisions and treating policyholders fairly. The Commission’s decision provides relief to the heirs of the deceased policyholder and sets a precedent for similar cases in the future.
India: Cashless hospital services resume through AHPI and Star Health partnership, as reported by Asia Insurance Review.
A recent dispute between hospitals and insurance providers in India has been resolved, with cashless hospital services set to resume from October 10. The dispute, which had been ongoing, had left many patients without access to cashless medical treatment. The Association of Healthcare Providers (India), or AHPI, which represents hospitals, had been at odds with insurance providers, including Star Health, over tariffs and payment rates.
As a result of the dispute, many hospitals had stopped offering cashless services, forcing patients to pay out of pocket for medical expenses and then claim reimbursement from their insurance providers. This had caused significant hardship for many patients, who were already struggling with the financial burden of medical treatment.
However, following negotiations between the AHPI and Star Health, the two parties have reached an agreement, and cashless services are set to resume. The agreement is seen as a major relief for patients, who will once again be able to access medical treatment without having to worry about the financial burden.
The dispute between hospitals and insurance providers had highlighted the need for a regulator to oversee the healthcare industry and resolve disputes between providers and insurers. The hospital group has urged the creation of a regulator to prevent such disputes in the future and ensure that patients are not caught in the middle.
The resumption of cashless services is expected to benefit thousands of patients who were affected by the dispute. Hospitals had complained that insurance providers were not paying them adequately for medical services, leading to a significant shortfall in revenue. Insurance providers, on the other hand, had argued that hospitals were charging exorbitant rates for medical services.
The resolution of the dispute is seen as a positive step for the healthcare industry in India, and patients can once again access medical treatment without worrying about the financial burden. The agreement between the AHPI and Star Health is expected to set a precedent for other insurance providers, and cashless services are expected to resume across the country. The creation of a regulator to oversee the healthcare industry is still being debated, but the resolution of the dispute is a major step forward for patients and healthcare providers alike.