Mental Health–Related Claims Witness Sharp Rise In India: Report

Mental health insurance is a topic that is often neglected when we discuss healthcare. However, an analysis of recent trends suggests that this reality is changing. As per a recent data released by Policybazaar, an online insurance marketplace, mental health-related claims have now risen by 30 to 50 per cent over the past two or three years.

The data, which highlights consumer behaviour between 2023 and 2025, shows a 41 per cent year-on-year growth in searches for mental health insurance. Most of these queries are coming from the 25–35 age group, a generation more open about mental health concerns and actively seeking out financial protection for therapy, counselling, and psychiatric consultations.

“This is not a marginal trend anymore,” says Siddharth Singhal, Head of Health Insurance at Policybazaar. “Mental health is becoming a priority. Our latest numbers show a substantial jump in interest and claims, especially among young professionals, women, and residents of metro cities.”

What the Claims Reveal

Among all mental health-related insurance claims filed, anxiety disorders account for the largest share at 30–35 per cent, followed by depression, which makes up 25–30 per cent of the claims.

Around 15 to 20 per cent of claims are a factor of workplace stress and burnout, majorly reported by professionals in demanding jobs.

Most of these are mild to moderate conditions, which could mean people are looking at early intervention of mental health issues as a common practice.

However, severe mental illnesses such as bipolar disorder, OCD, and PTSD seem to be underreported, a key red flag that points towards stigma and lack of formal diagnosis when it comes to mental health check-ups.

Why the Spike Now?

The post-Covid period has changed how people approach health. Broader access to outpatient department (OPD) benefits, growing awareness around therapy, and efforts to destigmatize mental illness, particularly in urban India, have made it easier for people to seek help and use insurance to pay for it.

“Cashless therapy is now something we hear about regularly,” said Singhal. “That’s a big leap from even a few years ago when people didn’t know it was an option.”

India’s top cities, such as Delhi NCR, Mumbai, Bengaluru, Chennai, and Hyderabad, currently account for 50 to 55 per cent of all mental health insurance uptake. Greater access to therapists, higher disposable incomes, and progressive workplaces with mental wellness initiatives have all played a role.

Women More Likely to Opt for Coverage

Women are 27 per cent more likely than men to enroll in health plans that include mental health benefits, the report states. The reason behind this could be because of the mental health needs of women that often intersect with reproductive and caregiving responsibilities, which women typically shoulder in larger measure.

About 65 per cent of insured women choose policies that offer additional features for mental and hormonal health. Claim data also shows common stressors tied to the life transitions of women, such as fertility treatment, motherhood, menopause, and balancing work with family obligations.

Mental health and key life changes

A look at the data shows that first-time claims for mental health coverage also tend to cluster around key life stages.

Where young professionals say that career pressure, relocation, and work-life imbalance are what leads them to seek out mental health insurance, middle-aged policyholders are more likely to report burnout and financial strain as the primary cause.

Older adults, though less likely to file claims, also face emotional challenges, which typically stem from isolation and health anxiety. The gap in post-retirement mental health claims is seen as a byproduct of stigma and low digital literacy among older Indians, who may not fully utilize or even know about therapy benefits included in their plans.

The insurance industry is taking note of this change. With more people opting for mental health benefits, providers are being pushed to expand coverage and simplify access to cashless services for therapy, counselling, and psychiatric consultations.

“This isn’t just a consumer trend, it’s a societal one,” said Singhal. “We’re seeing mental health move from the margins to the mainstream of healthcare planning. But we still have a long way to go in reducing stigma and making mental healthcare universally accessible.”

For India, the data signals more than a spike in claims; it reflects a generational and cultural shift in how people value and protect their mental well-being, not just in conversation but in concrete financial planning.