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Health Insurance Price Index

Analysis and Insights from Pricing of Health Insurance
from leading insurance companies in India.

Bird's Eye View

Bird's Eye View

The index value has recently increased to Rs. 25,197 in Q2 2021 whereas in Q1 2021, the prices have remained constant at Rs. 24,026 for health. The index value has increased by 4.87% in Q2 in comparison to the last quarter. This spike in the index value of health is somewhere attributed to the impact of COVID-19.

The pandemic has underlined the importance of having a health insurance policy to manage finances during a medical emergency. It is feasible to buy a comprehensive health plan at affordable premiums.

The average prices for a sum assured of 5 lakhs and 10 Lakhs are Rs. 21801 and Rs. 28629, respectively. Prices shown here are the average prices for all the age groups: 26 years, 36 years, 46 years, and 56 years & all types of coverages i.e., 1 adult, 2 adults, 2 adults + 1 child, and 2 adults + 2 children. The premium prices mentioned for different age groups are average prices taken from the top 6 health insurance companies for every quarter.

Bird's Eye View
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Segment Wise Premiums

The average premium prices for Q2 2021 mentioned in the table are taken from the top 6 health insurance companies for all the age groups from 26 to 46 years. Here is an example of the average premiums paid for two different sum assured values by a 26-year-old individual. He would pay Rs. 16,405 per annum for a sum assured of Rs. 10 lakhs and Rs. 12,743 for a sum assured of Rs. 5 lakhs.

Age Sum Assured 1A 2A 2A+1C 2A+2C Average Premium
26 5L 8077 11641 14101 17151 12743
10L 10313 15098 18304 21907 16405
36 5L 9191 13684 16207 18990 14554
10L 11904 17752 21210 24476 18835
46 5L 14943 23058 25226 28250 23214
10L 19953 31971 33430 36973 31528
56 5L 24840 37353 40031 43577 36450
10L 32373 49506 53096 57462 48109
Avg Premium 16327 25103 27701 31098 25197

*Source: Average prices in the above tabular data are determined from the leading 6 health insurance companies in India. These prices are for illustration purposes only. Actual prices may vary from insurer to insurer.

Average Premium Prices By Age

Average Premium Price Age

Health insurance premium increases with age as it is believed that with increasing age the chances of health problems also increases, thus it leads to increase the claim frequency. As per the findings of Q2 2021, the average premium for a 36 years old individual is Rs 16,740 higher than the average premium for 26 year old i.e.Rs 14,574. In Q2 2021, the average premium for all the age groups i.e. from 26-56 is Rs. 25,194.

Average Premium Price Age
Average Premium By Coverage Type

Average Premium By Coverage Type

Average Premium By Coverage Type

The family members covered under the policy directly influence the premium prices of insurance companies. Adding an adult member does not increase the price proportionately. For example, an individual pays Rs. 16327 when 1 adult is covered and in case of 2 Adults+2 Children, Rs. 31,098 is to be paid, highlighting the fact that the family floater plans are more economical than buying 2 separate policies.

As shown in the graph, there is a negotiable increase in the premium upon adding children to the policy. Most companies allow children up to the age of 18 or 21 to be added to the policies in a family floater plan.

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Premium Variance

Premium Variance

In Q2, 2021, the variance for 26-year-old is 47.66% that is greater than the variance observed for 36 years old i.e., 65.43%. Of the 6 companies, forming the index, the variance observed in premiums among the health companies is quite high as compared to variance observed in term insurance companies. This is primarily because of the fact that coverages, features, and benefits differ significantly for health insurance whereas term insurance is usually simple with similar benefits in case of death.

Premium Variance
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Index Computation Methodology

The prices & charts displayed above are based on the average premium prices of 6 health insurance companies in India. We have selected one public and five private health insurance companies in terms of their GWP earned as per the IRDAI annual report 2019-20 (The New India Assurance Co. Ltd, Star Health and Allied Insurance Co. Ltd, ICICI Lombard General Insurance Co. Ltd, Bajaj Allianz General Insurance Co. Ltd, HDFC ERGO General Insurance Co. Ltd & Religare Health Insurance Co. Ltd.)

The prices represent the annual premium for each sample customer pertaining to age, coverage type & sum assured in Q2 2021 (April’21 - June’21). The Insurer’s individual rate may vary depending on age, coverage type, health profile, sum assured & add-on riders.

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