Middle class affected by health insurance premium hikes, IRDAI not meeting expectations: CTI to finance minister

Chamber of Trade and Industry (CTI) has raised concerns over the sharp rise in health insurance premiums and urged the government to take immediate action to provide relief to the middle class and small traders.

In a letter to Finance Minister Nirmala Sitharaman, CTI chairman Brijesh Goyal said health insurance premiums have increased by 15 to 20 per cent in the last few years, putting a strain on household budgets and forcing many people to discontinue their policies midway.

The rising cost of premiums is adversely affecting the middle class, especially small traders, who are already battling inflation and financial stress, he added.

"Many families are unable to bear the burden of increasing insurance costs and are being forced to give up their health policies," Goyal said.

The CTI has urged the finance ministry to issue clear guidelines to regulate premium hikes and ensure uniformity, as different insurance companies are raising premiums arbitrarily, leading to confusion and distress among policyholders.

Goyal also claimed that despite being tasked with monitoring insurance companies, the role of the Insurance Regulatory and Development Authority of India (Irdai) has not been effective.

"Irdai was formed to oversee policy and premium regulations, but its performance has not met expectations," he said.

According to CTI, overall insurance coverage has also declined. Health insurance coverage dropped from 4.2 per cent in 2021-22 to 4 per cent in 2022-23, while life insurance coverage fell from 3.2 per cent to 3 per cent.

The chamber has urged the government to take strict action against companies raising premiums without proper justification and bring in measures to protect the interests of common citizens.