According to the latest data released by the Insurance Regulatory and Development Authority of India (Irdai), grievances in the general and health insurance segment jumped 41% year-on-year to 1,37,361 in FY25, compared with 97,503 complaints in the previous financial year. The spike was particularly visible among standalone health insurers.
Standalone health insurers continued to account for a significant share of complaints. Grievances against standalone health insurers rose 33% to 46,151 during the year. Among large players, Star Health and Allied Insurance reported a 22% increase in grievances to 20,527. Care Health Insurance saw complaints jump nearly 49% to 10,281, while Niva Bupa Health Insurance recorded a 50% increase in grievances to 7,970. Aditya Birla Health Insurance reported a 37% increase in complaints to 5,329.
Industry executives attribute the surge in health insurance grievances to a rise in claim costs. In health insurance, the total cost for insurers can run at 120-140% of the premium collected, making it financially impossible to settle every claim without losses, insurance experts say.
Hospital behaviour adds to the strain. Treatment patterns often change once a patient is identified as insured, pushing up bills. Unlike life insurance, where a policy typically results in one claim over a lifetime, health policies can generate multiple claims in a single year, leading to higher grievances.
The industry recorded a total of 2,57,790 grievances during FY25. Of these, 1,20,429 were related to life insurance business, while 1,37,361 pertained to general and health insurance. Among general insurers, National Insurance reported 12,858 policyholder grievances in FY25, more than double the 5,680 complaints recorded in FY24, the highest among public sector general insurers.
fault lines Industry executives point to a rise in claim costs and hospital behaviour for the surge in health insurance grievances
Claims continue to be the biggest trigger as in the general and health insurance segment, nearly 69% of all grievances were related to claims, which are issues around claim repudiation, delays and partial settlements. In contrast, life insurance grievances showed a different pattern where of all life insurance complaints, close to 64% were linked to survival claims, policy servicing issues and unfair business practices.
Irdai has flagged mis-selling as a big concern in the insurance sector, involving the sale of products. The regulator has advised insurers to conduct periodic root cause analyses to identify why complaints arise and to strengthen controls across different distribution channels.
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