India’s insurance regulator, the Insurance Regulatory and Development Authority of India (IRDAI), is set to introduce simple, low-cost health insurance products and performance scorecards for insurers and hospitals, as the sector works to balance customer concerns with profitability. The move comes after insurers settled claims worth around ₹85,000 crore in the last financial year.
According to industry sources, the Confederation of Indian Industry (CII) is assisting IRDAI in developing this framework. The initiative aims to boost insurance penetration currently among the lowest globally and bring greater stability to a sector the regulator has described as being in an “unstable equilibrium.”
The hospital and insurer scorecards, expected to be introduced from June 2026, will help policyholders make more informed decisions and improve transparency across the system.
IRDAI is also proposing a policyholder-centric commercial model that links hospital pricing to performance indicators. Hospitals that process claims quickly and follow turnaround timelines may receive better tariffs, while delays, billing issues, or incomplete documentation could lead to reduced rates.
Additionally, a basic, no-frills health insurance product is being planned to expand coverage and make policies more affordable. This will be supported by a stronger focus on preventive care and wellness, signalling a shift away from a purely hospitalisation-based approach.
To resolve ongoing conflicts between insurers and hospitals, the regulator plans to enforce formal agreements with clear guidelines on billing, claims handling, and dispute resolution. It has also indicated that cashless treatment facilities should not be abruptly withdrawn due to commercial disagreements, and arbitrary suspension of hospital networks will be discouraged.
