Health Insurance Isn’t a Trap — It’s Just Deeply Misunderstood

 A recent article - Why health insurance looks like a trap to so many Indians - The Times of India claimed that health insurance “feels like a trap” for many Indians.

As someone who works closely with this industry, I understand why people feel that way — but I also think this perspective misses several critical nuances.

pc- unknown

Let me share what I’ve learned from experience:

🩺 Premiums are rising — but so are healthcare costs
Medical inflation in India is nearing 14% — among the highest in Asia.
Hospitals often charge vastly different rates for the same treatment, and insurers have to recalibrate premiums just to keep up. It’s not about profit, it’s about sustainability.

pc - The Economic Times

💰 Comprehensive insurance is more affordable than people think

For instance, a family of 2 Adults can get ₹30Lac Accident Coverage +  ₹5Lac protection from major diseases for as low as ₹7200 (that’s less than ₹600/month!).

That’s not bad for peace of mind and a big safety net.

pc- Manipal Cigna Insurance

💸 The article suggests saving instead of buying insurance — but that’s a risky strategy
Even if you set aside ₹32,000 annually with great returns, it’ll take ~15 years to build ₹10 lakhs.
But what happens if an emergency strikes next year? A single hospital bill can wipe out your entire savings.

📉 Insurers aren’t exactly minting money either
Over 70% of premium income goes toward claims. The industry has posted losses of ₹26,364 crore over five years (CAG).
Health insurance isn’t a cash cow — it’s a long-term risk management tool.

📊 Yes, claim disputes exist — but they aren’t the norm
According to IRDAI, nearly 2 crore health claims were settled last year, totalling ₹65,000 crore.
The majority were processed within 15–30 days. The system works for most — we just hear about the exceptions more often.

Health insurance isn't perfect. It needs greater transparency, better hospital accountability, and stronger customer awareness.

But calling it a "trap" discourages the very people who most need its protection.

As a professional in this space, I truly believe the solution lies in collaboration: between insurers, hospitals, regulators and policyholders.
Because if there's anything more expensive than a premium — it’s being unprepared when illness strikes.

#HealthInsurance #IndiaHealthcare #FinancialSecurity #RiskManagement #InsuranceAwareness


Disclaimer: I am a IRDAI qualified Insurance Advisor. No gift in kind/cash has been taken from Manipal Cigna. The image is used only for Illustration. 


Comments

  1. VenkiApril 29, 2025 at 3:29 PM

    Great insight. This gives different and better perspective to everyone.

    ReplyDelete

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