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Heart diseases and natural deaths account for a significant portion of term insurance claims
Health insurance claims have surged significantly, with a 30% increase in payouts over the last three years. (Representative image)
India’s insurance landscape is undergoing significant changes, driven by rising healthcare costs, increasing prevalence of chronic diseases, and growing awareness about financial protection. According to data from Policybazaar, health insurance claims have surged by 30% over the past three years, highlighting the dual impact of seasonal illnesses and long-term health conditions like diabetes and heart disease. Meanwhile, term insurance trends reveal that heart-related issues and natural deaths account for nearly 60% of claims, underscoring the growing health risks faced by Indians.
These findings shed light on how Indians are using insurance as a critical tool to navigate the challenges of modern life and safeguard their financial stability.
Rising Claims Across Age Groups and Conditions
Health insurance claims have surged significantly, with a 30% increase in payouts over the last three years, according to data shared by Policybazaar. Seasonal and chronic conditions are major contributors, reflecting both short-term fluctuations and long-term health trends.
Seasonal and Chronic Conditions Drive Claims
The most common health conditions leading to claims include fever (Seasonal Diseases), Gastritis, Heart Disease, Diabetes and Cancer. Seasonal diseases like fever typically drive a surge in claims during specific months, particularly during the monsoon and winter seasons.
Meanwhile, conditions like heart disease, diabetes, and cancer reflect long-term health trends, indicating the increasing prevalence of chronic diseases among Indians.
Rising Costs Reflected in Claim Payouts
The 30% rise in average payouts points to escalating healthcare costs and a greater reliance on insurance to manage medical expenses. This underscores the impact of medical inflation, which continues to outpace general inflation.
Urban Centers Lead in Claim Values
States like Maharashtra and Delhi report higher claim payouts despite having a similar proportion of total claims. This can be attributed to the higher cost of healthcare in urban centers and the more advanced medical facilities available.
Claims Frequency Increasing
The frequency of claims has steadily increased over the last three years. It means that more policyholders are utilising their health insurance benefits.
This could be due to improved access to healthcare services, a greater awareness of health insurance coverage, and a proactive approach to managing personal health.
Younger Adults Filing More Claims
The higher share of claims from younger adults (18-35) reflects a combination of seasonal illnesses (fever, viral infections) and rising claims for chronic conditions like diabetes, which are increasingly diagnosed at younger ages. This trend underscores the need to buy health insurance when young and healthy.
The gender distribution (86% male) is typical of health insurance claims, as men tend to file claims more frequently, possibly due to higher penetration of health insurance among males.
Term Insurance
Heart Diseases and Natural Deaths Dominate Claims
Heart diseases and natural deaths account for a significant portion of term insurance claims, as revealed by Policybazaar’s findings.
Key Drivers of Term Insurance Claims
-Heart diseases contribute to 25-30% of claims.
-Natural deaths account for 30-35%.
-Accidents make up 15-20%.
These trends reflect the aging population and heightened awareness of health risks. Notably, COVID-19-related claims still have an impact three years post-pandemic.
Male Policyholders Lead in Claims
Men account for 90-92% of term insurance claims, largely due to higher policy penetration and higher mortality rates among male policyholders.
Urban Regions See Higher Claim Volumes
Maharashtra, Uttar Pradesh, Delhi, Karnataka, and Gujarat dominate term insurance claims. These regions benefit from larger urban populations and better access to financial services, leading to greater adoption of insurance products.
Riders Gaining Popularity
Nearly 35-40% of term insurance policyholders are opting for riders such as critical illness and accidental death benefits. This reflects the growing demand for comprehensive protection among policyholders.
The data underscores the growing importance of health and term insurance in managing health risks and financial security. As healthcare costs rise and chronic diseases become more prevalent, insurance plays a vital role in ensuring access to quality care and safeguarding families against unforeseen events.
