Page 13 - The Insurance Times January 2025

AI-powered tools, with accuracy rates the pandemic, reflecting a shift toward compared to just 7,500 in FY23, mark-
exceeding 94%, are aiding tumor char- robust health insurance options. ing a 1,910% rise. The claim rejection
acterization and enhancing precision rate jumped to 1.25%, up from 0.06%
oncology. Experts highlight AI's role in Star Health Reports No the previous year, primarily due to
reducing drug discovery costs and pre- stricter scrutiny regarding non-disclo-
dicting patient outcomes. With its in- Impact from Data Breach, sure of pre-existing conditions and
tegration into cancer care, Indian hos- Growth on Track lapses in policy renewals.
pitals are setting benchmarks for using Star Health & Allied Insurance has as- The total number of claims filed grew
technology to improve patient out- sured customers of no financial impact by 15% to 1.2 crore, yet only 71% of
comes and resource efficiency, signal- or data misuse following a recent claims by value were settled. Insurers
ing a new era in healthcare innova- breach linked to compromised pass- disbursed Rs. 83,493 crore out of Rs.
tion. words of external agents. The com- 1.2 lakh crore claimed. Disallowed
pany has implemented enhanced secu- claims totaled Rs. 15,100 crore, while
Demand for Super Top-Up rity measures, including updated poli- Rs. 10,937 crore were repudiated fol-
Health Insurance Rises cies and fortified firewalls, to prevent lowing document scrutiny, and Rs.
future incidents. 7,584 crore worth of claims remained
Post-Covid outstanding.
Despite the breach, Star Health re-
Super top-up health insurance plans IRDAI has urged insurers to enhance
ported steady customer retention and
have gained popularity in India follow- minimal inquiries. The insurer remains transparency in claim settlements and
ing the Covid-19 pandemic, driven by optimistic about growth, projecting an clearly communicate the reasons for
rising medical costs and increased 18% increase in gross written premi- rejections. It is also considering stan-
awareness. Data from PolicyBazaar ums to Rs 18,000 crore in FY25, up dardized claim procedures to improve
shows super top-ups now account for from Rs 15,250 crore in FY24. With a efficiency and reduce disputes. Policy-
34.6% of health insurance premiums in holders are advised to disclose accurate
focus on cybersecurity, the company
FY24, up from 10.5% in FY19. spends 1.5% of its premiums annually medical histories, understand policy
These plans cover expenses beyond the on technology, positioning itself as an terms, and ensure timely premium pay-
base policy's threshold, providing af- industry leader in digital resilience. ments to avoid future rejections.
fordable, comprehensive coverage.
Industry experts attribute the surge to Health Insurance Claim Health Insurers Process
medical inflation, which stands at 14%, 71% of Rs. 1.2 Lakh Crore
and growing consumer recognition of Rejections Surge in FY24
the inadequacy of lower coverage poli- India witnessed a sharp increase in Claims in FY24
cies. The average base policy sum in- health insurance claim rejections dur- In the financial year 2023-24, health
sured has doubled to Rs 10 lakh since ing FY24, with 1.5 lakh claims denied insurance companies in India pro-
cessed over 3 crore claims totaling Rs.
1.2 lakh crore. Of these, approximately
Health Insurance Claim Sizes Surge by 30% in Three 2.7 crore claims amounting to Rs.

Years 83,493 crore were settled, represent-
ing 82% of the claims by volume and
Health insurance claim amounts in India have risen by over 30% in three 71.3% by value.
years, driven by higher medical costs and increased coverage options, ac-
cording to PolicyBazaar. The average claim in FY25 stands at Rs 81,000, The remaining claims were either dis-
allowed, repudiated, or remained out-
with Tamil Nadu leading at Rs 1.13 lakh.
standing. Claims worth Rs. 15,100
Post-Covid medical inflation, estimated at 14%, has significantly raised treat- crore were disallowed as they did not
ment costs. Insurers report higher claim frequency, particularly among meet specific policy criteria, while 36
younger policyholders aged 18-35, who account for 38% of claims. Enhanced lakh claims totaling Rs. 10,937 crore
awareness has also spurred demand for add-ons like critical illness and ac- were repudiated after document scru-
cidental death covers. Insurers are redesigning policies to include modular tiny. Additionally, 20 lakh claims valued
benefits, ensuring customers are protected against rising healthcare ex- at Rs. 7,584 crore (6.4%) remained
penses. outstanding.

12 January 2025 The Insurance Times