Pollution Pushes Health Insurance Premiums Higher: What Policyholders Must Know

In February, it was reported that insurers are likely to hike health insurance premiums by 10-15 per cent as health insurance claims sharply went up in Delhi in the winter months.

Insurance premium increases attributed to pollution are becoming more common, as insurers are beginning to price in long-term expenses related to the treatment of chronic respiratory and heart diseases. Customers should expect this trend and budget for higher renewal premiums.

“It is also important for customers to consider additional coverage under a "top-up" policy instead of just relying on their base policy plan. It will be increasingly important to have regular health check-ups because insurers are beginning to reward customers for being proactive with their health management habits,” says Arun Ramamurthy, co-founder, Staywell.Health, a health insurance provider.

What’s Covered Under Standard Policies

Comprehensive health insurance policies in India cover respiratory illnesses, but coverage varies from plan to plan. Hospitalization for acute infections (pneumonia, bronchitis) and chronic conditions like asthma or COPD is covered. 

Coverage will also include room rent, tests, and treatment. ICU and ventilator support will also be covered by most policies. However, for coverage of expenses like inhalers, oxygen therapy, and OPD consultations, OPD and consumables add-ons would be required.

Why Policy Fine Print Matters In Pollution-Linked Claims

Policyholders should check that their policy has no waiting periods or sub-limits for chronic respiratory and cardiovascular conditions.

“They should also review exclusions and co-pay clauses related to pollution-linked ailments. Additionally, ensure there is no room rent capping or disease-specific caps,” says Abhishek Kumar, a Securities and Exchange Board of India (Sebi)-registered investment advisor (RIA), and founder and chief investment advisor of SahajMoney, a financial planning firm.

Thoroughly examine exclusions related to pre-existing conditions, waiting periods for lung or heart conditions, and limits on the coverage of long-term hospital stays. “Many policies will cover acute treatment but will limit coverage of recurring care, oxygen therapy, or consulting specialists.

You should also determine if your plan will cover treatment at a hospital specializing in respiratory care on a cashless basis,” says Arun Ramamurthy, co-founder, Staywell.Health, a health insurance provider.

Smart Ways To Manage Rising Premiums

Higher premiums do not always mean that changing your insurer is the best option. Increasing the sum insured via a top-up policy can often be a more cost-efficient option than just purchasing a larger, standalone policy. Group health cover (especially through employers or associations) can also be a worthwhile option, as they are less exposed to risk pricing at the individual level.

If premiums become unaffordable, one option is to reduce costs by opting for a deductible or co-pay plan. If that’s not viable, consider porting the policy to another insurer without compromising on network tie-ups and other key benefits.

Alternatively, explore group health cover through your employer or professional associations, as this can help in lowering premiums.