National Insurance Awareness Day: 63% of policyholders unable to switch to better health insurance

As health insurance ownership continues to rise across India, a new set of challenges is coming into focus, not around buying insurance, but around whether the insurance already held continues to serve the people holding it. Insights from CoverSure’s Policy Health Check, based on an analysis of over 1 lakh policyholders, reveal that a significant share of India’s insured population is either locked out of better coverage or has yet to pursue it, even when the path is open.

Nearly 49% of existing policyholders with no pre-existing conditions, people who are medically eligible and well-positioned to upgrade, continue to hold basic, non-comprehensive plans. The gap here is not one of access. It is one of awareness and engagement. Many policyholders simply do not revisit their insurance after buying it, and so coverage that was adequate at one point in life quietly becomes inadequate as circumstances change.

Further, the data show that 63% of policyholders who wanted to switch to a more suitable health plan were unable to do so, primarily because they had developed pre-existing medical conditions that made migration or portability difficult. For these policyholders, the intent to move exists. What has changed is their health, and with it, their options. What is equally significant is what is happening among those who face no such barrier.

The data also surfaces a concern around coverage depth. While one-third of policyholders hold a sum insured of around ₹10 lakh, a majority of those above 50 years of age carry coverage below ₹5 lakh. Among policyholders already living with chronic conditions, 17% hold less than ₹5 lakh in sum insured. These are individuals who are statistically more likely to be hospitalised, and yet hold coverage that a single admission in a tier-1 city can wipe out entirely.

The health profile of policyholders using the tool further underscores the urgency. Around 35% of those assessed reported having a medical condition. Of policyholders with lifestyle-related ailments, diabetes, hypertension, high cholesterol, and thyroid disorders, nearly 69% fall within the 30 to 54 age band – the years when these conditions most commonly surface and when financial responsibilities are at their peak. The 50 to 54 age group alone accounts for the single largest share at 18.1%, closely followed by the 40 to 44 and 55 to 59 bands, each at 14.9%. These are conditions arriving during peak earning years, at a stage of life when coverage gaps carry the highest financial and personal consequences.

There is, however, a more encouraging signal in the data. Around 41% of users who undertook a Policy Health Check were between 30 and 40 years old, with another 10% under 30. Younger policyholders appear to be engaging proactively with the question of whether their existing coverage is sufficient, a shift that, if sustained, could meaningfully change how India’s insured population relates to its policies over time.

 Commenting on the findings, Saurabh Vijayvergia, Founder & CEO, CoverSure, said, “Buying insurance is a starting point, not a destination. A policy that was right at 32 may leave someone dangerously underprotected at 35. Healthcare costs are rising, and lifestyle conditions are arriving earlier than most people expect. The problem is that policyholders rarely discover these gaps on their own; they discover them during a medical event, when it is already too late to change anything. The most dangerous period in insurance is not before you buy. It is the years after, when life has moved and the policy has not. The Policy Health Check exists to surface that gap before it becomes a crisis.”

The findings highlight the importance of periodically reviewing health insurance coverage, particularly as healthcare costs rise and health profiles evolve. CoverSure’s Policy Health Check evaluates key aspects of a policyholder’s health cover, sum insured adequacy, plan comprehensiveness, pre-existing disease implications, and portability considerations, and gives policyholders a clearer picture of where they stand and what, if anything, needs to change.

At its core, the data reflects CoverSure’s belief that the value of insurance is not fully realised at the point of purchase. It is realised when the coverage a person holds is genuinely adequate for the life they are living, and when they know it.