In today’s world, a single medical emergency can wipe out years of savings. That’s why understanding health insurance costs is no longer optional; it’s essential. Whether you’re living independently, are newly married, or managing the needs of a joint family, understanding how much to pay for a plan and what factors influence that cost can make a significant difference. By understanding these elements, you can make more informed financial decisions, choose a health insurance plan that offers value without compromising benefits, and save money.
Friendly reminder: It’s easy to get lost comparing policies and premiums. Instead of spending hours on it, why not get personalised insurance advice from Ditto? We offer free consultations with zero spam! Just 30 minutes to clarify all your doubts. Book a call now!
Best Health Insurance Plans in India 2025
| Plan Name | Restoration | Renewal Bonus | Network Hospitals | CSR | ICR |
|---|---|---|---|---|---|
| HDFC ERGO Optima Secure | 100% of base SI, once/year (addon: unlimited) | 50% pa, up to 100% (irrespective of claims) | 13k+ | 98% | 86% |
| Care Supreme | Up to base SI, unlimited times | 50% pa, up to 100% (addon: up to 500%) | 11.4k+ | 90% | 59% |
| Aditya Birla Activ One Max | 100% of base SI, unlimited times | 100% pa, up to 500% (irrespective of claims) | 12k+ | 95% | 68% |
| Niva Bupa Aspire Titanium+ | Unlimited restoration after the first claim | Booster+: Carry forward unused cover up to 10x | 10k+ | 91% | 58% |
| ICICI Elevate | Unlimited restoration of base cover | 20% pa up to 100% Addon: Up to unlimited renewal bonus | 10.2k+ | 85% | 83% |
What is Health Insurance Cost?
In simple terms, health insurance cost refers to the total expense of maintaining a health insurance policy. You must understand the differences between each, especially copayments vs deductibles. This includes:
- Premiums: The fixed amount you pay monthly or annually to keep your coverage active. Think of it as a subscription fee for maintaining your coverage.
- Deductibles: A deductible is the amount you must pay out-of-pocket each year before your insurance starts covering claims. For example, if your deductible is ₹25,000, you must pay that amount first before the insurer begins contributing.
- Copayments (Copays): A copayment is your fixed share of a medical expense, often expressed as a percentage. For instance, if you have a 20% copay on hospital bills, you pay 20% of the cost, while the insurer pays the remaining 80%.
- Loading Charges: Loading is an additional charge applied to your premium due to higher risk factors, such as pre-existing diseases or past claims. It helps insurers manage the extra risk of covering you.
Each component contributes to the overall cost of health insurance and plays a vital role in determining your financial protection.
Note: Most health insurance providers in India offer yearly premium payments only. While some may allow monthly EMIs, these often come with additional processing fees or interest, increasing the overall cost. Always check with the insurer before choosing the payment frequency.
Understanding Health Insurance Premium
A health insurance premium is the cost you pay to keep your health coverage active. Instead of bearing the burden of a ₹10 lakh medical bill during an emergency, you might pay an annual premium of ₹10,000–₹25,000 to secure that financial protection in advance.
This wide range exists because premiums aren’t one-size-fits-all; they depend on various factors, such as your age, location, sum insured, pre-existing medical conditions, and overall health. We’ll explore these in detail in the next section.
To understand the importance of paying this premium, as per data from IRDAI, health insurers collectively settled over ₹80,000 crores in claims last year. Without insurance, these medical expenses could’ve pushed countless families into debt or poverty. Having the right insurance policy doesn’t just cover bills; it protects your savings, future, and peace of mind.
What Influences Health Insurance Premiums in India?
Understanding the factors that impact your medical insurance premium can help you choose a plan that offers the best value. Here are the key elements that insurers consider:
- Age: Age is one of the most significant factors determining health insurance costs. Younger individuals are considered lower risk for insurers as they are less likely to make frequent claims and usually have fewer pre-existing health conditions. This leads to them generally paying lower premiums, while premiums increase with age due to higher chances of medical claims.
- Location: Your residential city can influence health insurance prices. Those living in metropolitan cities like Mumbai or Delhi tend to pay more because healthcare facilities are generally more expensive in tier-1 cities compared to tier-2 or tier-3 cities.
- Number of Policyholders Covered: Insurers price their offerings based on the kind of coverage you opt for. An individual policy offers personalized protection, but it can be more expensive per person when covering multiple family members. On the other hand, a family floater plan covers the entire family under one sum insured, making it more economical in many cases. The choice between the two can significantly influence your overall premium.
- Sum Insured: While plans with higher coverage offer better financial protection during medical emergencies, premiums don’t always increase proportionately. For example, a ₹10 lakh policy might cost just ₹8,000–₹10,000; only slightly more than ₹7,000 for a ₹5 lakh policy. However, it's essential to note that a higher sum insured does not automatically mean more features or better benefits. Financial protection also depends on what the policy covers, not just how much it covers.
- Pre-existing Medical Conditions: If you have chronic conditions like diabetes, hypertension, or asthma, insurers may apply loading charges —an additional cost added to your premium based on your health risk. Similarly, a high body mass index (BMI) can also lead to higher loading as it increases the likelihood of future claims. In some cases, insurers impose waiting periods before coverage for these conditions begins, which all contribute to a higher overall premium. This risk-based pricing increases the health insurance cost in India.
- Lifestyle Factors: Unhealthy habits such as smoking, high alcohol consumption, or a high BMI are seen as high-risk factors as they increase the risk of future illnesses and hospitalizations. Since insurance works on risk assessment, these can significantly raise your health insurance premiums. For instance, a 45-year-old who maintains a healthy lifestyle may pose a lower risk and pay a lower premium when compared to a 25-year-old with poor lifestyle choices simply because the latter has a higher probability of making claims.
- Policy Add-ons and Riders: Additional features, such as maternity coverage, OPD benefits, consumables coverage, or room rent waivers, increase your premium. While they raise the cost of health insurance in India, they can offer enhanced protection tailored to your needs. Please keep in mind that add-ons like maternity, OPD, and international coverage are more expensive than others, so only include them if you need them.
- Claims History and No-Claim Bonus (NCB): Insurers closely assess your individual claims history when pricing your premium. If you have made frequent or high-value claims, you are considered a higher risk, and this can result in an increase in your premium at the time of renewal. On the other hand, if you haven’t made any claims during the policy year, you may be rewarded with a No-Claim Bonus (NCB) either in the form of a cumulative bonus (increased sum insured at no extra cost) or premium discounts. Insurers also track overall claim trends across customers, so even if you haven't made claims, rising industry-wide claims may still lead to premium hikes.
- Medical Inflation: Healthcare costs in India have experienced a significant rise, with expenses for medical services such as surgeries, diagnostic tests, and hospital stays steadily increasing over the past few years. This surge is driven by increased prices of equipment, consumables, and even doctor consultation fees. As a result, insurers are compelled to adjust their pricing to remain competitive. Along with medical inflation, premiums also account for administrative overheads, digital infrastructure, and profit margins, making the cost of health insurance a reflection of both risk and the rising cost of delivering quality healthcare.
Average Health Insurance Cost in India
The cost of health insurance in India depends on several factors like age, health condition, type of plan, and sum insured. To give you a practical idea, here’s a breakdown of average premiums based on data from the top insurers in the country:
Individual Health Insurance Plans Costs
(Assumed Sum Insured = 15 Lakhs, No PED, Location = Tier 1 city)
| Age Slab | Premiums (Approx) |
|---|---|
| 20 | ₹10,000-₹16,000 |
| 25 | ₹11,000-₹17000 |
| 30 | ₹12,000- ₹18,000 |
| 35 | ₹12,000-₹19,000 |
| 40 | ₹15,000-₹20,000 |
| 45 | ₹18,000-₹22,000 |
(We’ve provided the premiums from the top 3 health insurance providers as recommended by our in-house experts.)
For young adults in their 20s to 40s, health insurance premiums for a ₹15 lakh cover range between ₹10,000 and ₹19,000 annually. Premiums gradually rise with age due to a higher risk of hospitalization and illnesses, reaching ₹22,000 by the age of 45.
Family Floater Health Insurance Plans Costs
(Assumed Sum Insured = 15 Lakhs, No PED, Location = Tier 1 city)
(2 Adults and 2 Children)
| Age Slab | Premiums (Approx) |
|---|---|
| 2 Adults = 25, 30 Years 2 Children = 1, 3 Years |
₹26,000- ₹35,000 |
| 2 Adults = 25, 30 Years 2 Children = 5, 6 Years |
₹26,000-₹35,000 |
| 2 Adults = 30, 35 Years 2 Children = 1, 3 Years |
₹26,000-₹36,000 |
| 2 Adults = 30, 35 Years 2 Children = 5, 6 Years |
₹26,000-₹37,000 |
(We’ve provided the premiums from the top 3 health insurance providers as recommended by our in-house experts.)
A family floater plan for two adults and two children typically costs between ₹26,000 and ₹37,000 per year. The age of the children has a minimal impact, but the age of the adults, especially those crossing into the 30s, can slightly increase the premium.
Senior Citizen Individual Health Insurance Plans Costs
(Assumed Sum Insured = 15 Lakhs, No PED, Location = Tier 1 city)
| Age Slabs | Premium (Approx) |
|---|---|
| 60 | ₹37,000-₹55,000 |
| 61 | ₹48,000-₹59,000 |
| 62 | ₹48,000-₹64,000 |
| 63 | ₹48,000-₹68,000 |
| 64 | ₹48,000-₹73,000 |
| 65 | ₹48,000-₹77,000 |
(We’ve provided the premiums from the top 3 health insurance providers as recommended by our in-house experts.)
Premiums for senior citizens rise significantly with age. A 60-year-old can expect to pay around ₹37,000–₹55,000 annually, which can increase to ₹77,000 by the age of 65, due to higher hospitalization risks and medical needs.
Senior Citizen Family Health Insurance Plans Costs
(Assumed Sum Insured = 15 Lakhs, No PED, Location = Tier 1 city)
| Age Slabs | Premiums |
|---|---|
| 2 Adults = 60, 50 Years 2 Children = 15, 18 Years |
₹60,000-₹82,000 |
| 2 Adults = 62, 60 Years | ₹70,000-₹90,000 |
| 2 Adults = 62, 60 Years 2 Children = 17, 18 Years |
₹85,000- ₹1,00,000 |
(We’ve provided the premiums from the top 3 health insurance providers as recommended by our in-house experts.)
Family floater plans for senior citizens or older families can be expensive, ranging from ₹60,000 to ₹1,00,000 annually. Premiums increase when both adults are over 60 or when older children are added to the policy.
While premiums vary based on age, health, and plan type, investing in the right policy early on can offer substantial long-term savings and peace of mind. Always compare plans carefully to find one that balances affordability with adequate coverage.
How to Calculate and Compare Health Insurance Costs?
To ensure you get the best value, comparing the base cost with the benefits, exclusions, and clauses, such as sub-limits, waiting periods, copayments, and deductibles associated with each plan, is crucial. Here's how to accurately calculate and compare India's health insurance cost.
- Feature Comparisons Across Plans: Based on features offered and the comprehensiveness of the policy, premiums vary vastly. Always check for features like room rent limits, pre- and post-hospitalization coverage, daycare procedures, network hospitals, and claim settlement processes. Sometimes, paying a slightly higher premium may offer better value if it means fewer limitations and more comprehensive coverage, provided the features align with your needs.
- Deductibles and Copayment Clauses: A deductible is a fixed amount you must pay upfront before the insurer starts contributing. For example, if your deductible is ₹50,000 and your hospital bill is ₹1,20,000, you’ll pay ₹50,000, and the insurer will cover the remaining ₹70,000. A copayment, on the other hand, is a percentage of every claim you must bear, regardless of the amount. So if you have a 10% copay on a ₹1,00,000 bill, you’ll pay ₹10,000 and the insurer will cover ₹90,000.
- Monthly vs. Annual Premiums: Many insurers and plans offer the option to choose between monthly, quarterly, and annual payment plans. While monthly premiums may seem budget-friendly, annual premiums often include discounts or added benefits. Moreover, as mentioned above, opting for monthly EMIs or quarterly payments can result in higher interest or EMI costs. Comparing both can help you identify which payment method is more economical in the long run, especially if you can pay upfront.
Tips to Reduce Health Insurance Cost
With a few innovative strategies, you can lower your premiums without compromising on coverage. Here’s a look at some ways you can reduce the cost of your health insurance plan.
- Take Advantage of Wellness Benefits: Some insurance providers offer discounts or incentives for maintaining a healthy lifestyle, such as completing health check-ups, exercising regularly, or quitting smoking. These wellness-linked benefits can earn you premium discounts at renewal.
- Utilize No-Claim Bonus (NCB): Many insurers offer a cumulative bonus for every claim-free year, increasing your sum insured without raising your premium. Over time, this can significantly enhance your coverage at no additional cost, making it one of the best value-added benefits in your policy.
- Leverage Employer Health Plans: If your employer offers health insurance, make the most of it. These plans are split between the employer and the employee. However, it’s wise to have a personal policy or super top-up alongside, so you’re not left vulnerable when switching jobs or retiring.
- Use Super Top-Up Plans: A super top-up plan is a backup to your existing base policy, offering higher coverage at a fraction of the cost. Instead of buying a single high-sum policy, you can combine a smaller base plan with a super top-up for better affordability.
- Choose Family Floater Plans: Instead of buying individual policies for each family member, a family floater covers all members under a single sum insured. This is especially beneficial for young families, where the risk of multiple hospitalizations is low. It’s more cost-effective and easier to manage. However, if a member of your family has pre-existing conditions or requires additional coverage, it is advisable to include them in a separate individual plan.
- Buy Early: When you’re young and healthy, insurers view you as low-risk, so your premiums are significantly lower. Plus, since you may not have substantial savings at this stage, investing early ensures financial protection during emergencies without straining your finances.
- Opt for Deductibles: Aggregate deductibles can help reduce premiums while keeping your out-of-pocket expenses predictable. If you’re financially stable and can manage a one-time payment during emergencies, this option makes sense over copayments, which apply to every claim. Also, please keep in mind that you should only opt for deductibles when you are unable to obtain any other plan due to critical illnesses or old age.
Reducing your health insurance premium isn’t about cutting corners—it’s about making intelligent, informed choices. By starting early, selecting the right plan type, and utilizing all available benefits, you can ensure comprehensive coverage while keeping your costs under control.
Why Paying for Health Insurance is Worth It?
Health insurance is a powerful financial tool that protects you from unpredictable medical costs. For a manageable premium, you get access to quality healthcare, financial peace of mind, and long-term benefits that far outweigh the cost. Here’s what makes health insurance a wise investment:
- Financial Protection Against Medical Emergencies: A single hospitalization, especially in a private hospital, can run into lakhs of rupees. Health insurance cushions you against these unexpected expenses, so you don’t need to dip into your savings or take loans during a crisis. It acts as a safety net for both planned and unplanned treatments.
- Access to Quality Healthcare: A health plan lets you choose from a vast network of reputable hospitals and doctors. Most insurers offer cashless hospitalization, so you can focus on recovery instead of worrying about paying bills upfront.
- Coverage for Pre- and Post-Hospitalization: Modern health plans don't just cover your hospital stay—they also reimburse expenses like diagnostic tests, medications, and follow-up consultations for a set period before and after hospitalization. This ensures comprehensive financial coverage for the entire treatment journey.
- Preventive Health Benefits: Many insurers offer annual health check-ups, vaccinations, and wellness programs to help individuals maintain their health. These benefits promote early diagnosis and better health management, often at no extra cost, helping you stay healthier in the long run.
- Tax Benefits: Under Section 80D of the Income Tax Act, you can claim deductions on the premiums you pay, up to ₹25,000 for self and family, and an additional ₹25,000 to ₹50,000 for parents. This helps reduce your taxable income while ensuring your health security. Please note that the total possible deduction is up to ₹1,00,000.
- Peace of Mind: Health insurance gives you peace of mind. Knowing that you're financially protected allows you to make decisions more calmly during emergencies, letting you focus on recovery rather than worrying about expenses.
Paying for health insurance isn’t a cost—it’s an investment in your health, future, and peace of mind. The returns may not be immediate, but when you need it most, your policy will step in and save you from life-altering financial setbacks. With rising medical costs and health risks, it’s one of the most innovative and responsible choices.
Frequently Asked Questions
How much does health insurance cost in India per month?
Health insurance premiums vary significantly based on factors such as your age, health status, location, and the type of plan you select. Therefore, it is challenging to provide a general range.
What affects my health insurance premium the most?
Several factors influence your premium: your age, current health conditions, family history of chronic illnesses, the chosen sum insured, and your city of residence. Medical inflation also plays a significant role, as rising treatment costs lead to higher premiums over time.
Do private insurers charge more than government ones?
Yes, private insurers usually charge slightly higher premiums. But these plans often come with broader coverage, cashless hospital networks, faster digital services, and fewer out-of-pocket expenses during hospitalization.
On the other hand, PSU insurers may offer lower premiums but often lag behind in terms of claim settlement experience and digital infrastructure. Many are financially strained due to welfare mandates. When exploring private insurers, ensure you check key metrics such as Claim Settlement Ratio (CSR), Incurred Claim Ratio (ICR), complaint volume, network hospitals, and business volume to select a credible insurer.
Can I get affordable insurance with good coverage?
Absolutely. You can check out some of the best health insurance policies in 2025, like HDFC ERGO Optima Secure, Care Supreme, Aditya Birla Activ One Max, Niva Bupa Aspire Titanium+, and ICICI Elevate. Compare plans thoroughly—platforms like ours (Ditto) can help avoid missing critical benefits.
Do group health plans cost less?
Yes, they usually do. Since the risk is spread across a large pool of employees, insurers can offer lower premiums. Plus, employers often subsidize or fully cover the cost. Many group plans also come with customizable add-ons, or riders, allowing you to tailor coverage to your specific needs.
Is it better to pay monthly or yearly?
Yearly payments are generally more economical, as monthly premiums may include additional processing charges and can sometimes complicate claims. However, the choice ultimately depends on your financial comfort. Go with what works best for your budget.
Why Choose Ditto for Buying Health Insurance?
At Ditto, we’ve assisted over 3,00,000 customers with choosing the right healthcare insurance policy. Here’s a look at why customers like Ankit below love us -
✅No-Spam & No Salesmen
✅Rated 4.9/5 on Google Reviews by 10,000+ happy customers
✅Backed by Zerodha
✅100% Free Consultation
You can book a FREE consultation. Slots are filling up quickly, so be sure to book a call now!
Conclusion
Understanding the health insurance cost allows you to make smarter financial decisions. By comparing plans, factoring in your specific needs, and using cost-saving strategies, you can obtain comprehensive coverage without overspending.
Last updated on
