Air pollution drives rise in health insurance claims India

India’s health insurance sector is experiencing an increase in claims linked to air pollution, with recent data from Policybazaar indicating higher volumes for both families and insurers.

The period following Diwali, when air quality often deteriorates due to seasonal factors such as crop residue burning and firecracker use, is associated with a rise in claims. Policybazaar’s data indicates that the proportion of pollution-linked claims increased from 6.4% in 2022 to 9% in 2025, a 14% relative increase. In September 2025, nearly one in 10 hospitalisation claims were attributed to ailments associated with air pollution, including respiratory infections, heart issues, and skin or eye conditions.

General Children under 10 most frequently affected

The report states that children under the age of 10 accounted for 43% of pollution-related health insurance claims, the highest proportion among all age groups. Adults aged 31 to 40 years represented 14% of such claims, while those over 60 years accounted for 7%. The data indicates that younger children, who may spend more time outdoors, are more frequently affected by poor air quality.

General Widening geographic impact

While Delhi continues to report the highest volume of pollution-related claims at 38%, similar patterns are now observed in other cities. Hyderabad and Bengaluru have reported higher claim ratios, at 8.34% and 8.23%, respectively. Other cities, including Pune (7.82%) and Mumbai (5.94%), have also recorded increases. Tier-2 cities such as Jaipur, Lucknow, Indore, and Nagpur have reported more cases, suggesting that pollution-related claims are being reported in a broader range of locations.

General Broader health consequences observed

The data reveals that the effects of air pollution are not limited to respiratory problems. There has been an increase in claims for cardiac conditions, hypertension, skin disorders, and eye infections during periods of poor air quality. Common diagnoses in these claims include asthma, chronic obstructive pulmonary disease (COPD), arrhythmia, eczema, and conjunctivitis.

General Medical expenses continue to climb

Treatment costs have increased. The average claim for pollution-related illnesses is now ₹55,000, with daily hospitalisation expenses averaging ₹19,000. Between FY23 and FY24, the cost of treating respiratory conditions increased by 11%, while cardiac-related expenses rose by 6%. These increases are attributed to greater demand for intensive interventions, such as oxygen support and nebulisation.

The WTW 2026 Global Medical Trends report forecasts a 14% increase in medical costs in the Asia-Pacific region for 2026. The report, based on a survey of 346 health insurers in 82 countries, found that 57% of insurers in the region expect medical cost inflation to continue for at least three more years, and 42% expect it to last longer. The adoption of advanced medical technologies is cited as the main factor driving costs, with 77% of insurers naming it as the primary cause. Pharmaceutical innovation (63%) and limited cost-sharing arrangements (51%) are also identified as contributors.

General Consumers cite healthcare costs as leading concern

The increase in treatment costs is also evident in consumer sentiment. The 2024 Manulife Asia Care Survey found that 75% of Asian respondents identified rising healthcare costs as their primary financial concern, ahead of general inflation. The survey of 8,400 participants reported an average perceived healthcare inflation rate of 23%, with the largest increases in prescription drugs, preventive services, outpatient care, and hospitalisation.