Health Insurance

Does India Need a Dedicated Health Insurance Regulator? An Analytical Perspective

- Om Prakash Prasad Senior Manager General Insurance Corporation of India

Health claims are one of the most disputed types of insurance in India. Policyholders often struggle with fine print exclusions, pre-existing condition clauses, sub-limits, and "reasonable and customary charges" that are unclear and difficult to understand.

Abstract

India's rapidly expanding health insurance sector faces distinct challenges that go beyond traditional insurance lines, including high information asymmetry, complex stakeholder dynamics, and integration with public health initiatives. While the Insurance Regulatory and Development Authority of India (IRDAI) has introduced significant reforms, it lacks the focused capacity to address issues such as claim disputes, TPA oversight, health system alignment, and digital health integration. This article critically examines whether India requires a dedicated health insurance regulator. It explores the benefits of specialised regulation, including improved transparency, fraud control, and stakeholder coordination, while also highlighting potential drawbacks such as regulatory fragmentation and increased administrative burdens. The article concludes that instead of creating an entirely new body, India should establish a quasi-autonomous Health Insurance Authority within IRDAI. This would preserve regulatory coherence while delivering the sector-specific focus necessary to build a robust, consumer-centric, and equitable health insurance ecosystem aligned with the goals of Universal Health Coverage.

1. Introduction