Hyderabad, May 7, 2026, 18:36 IST
- Star Health is rolling out two budget-friendly health insurance products aimed at tier-II and tier-III cities, eyeing a gross written premium target of Rs 24,000 crore for FY27. Gross written premium refers to total premiums collected before any deductions. ETHealthworld.com
- Claim payouts in Andhra Pradesh and Telangana jumped 24% for the insurer in FY26. In Kerala, a consumer panel criticized the company for denying a COVID-era claim. The Times of India
- Indian stocks had stopped trading before we went to press; the NSE wraps up its regular equity session at 15:30 IST. NSE India
Star Health and Allied Insurance is set to roll out two budget health insurance offerings aimed at smaller Indian cities within this fiscal year, targeting price-conscious consumers as higher payouts and a recent consumer-forum directive put its claims process under the microscope.
Timing, here, is crucial. Health insurance policyholders are contending with steeper hospital charges, and according to Star Health Managing Director and CEO Anand Roy in comments to the Economic Times, “annual hikes on health insurance premiums are here to stay.” The sector is being squeezed by medical inflation running at 13% to 14% annually. Medical inflation captures rising costs tied to treatment, hospitals, and healthcare services. The Economic Times
Roy said the company’s looking to hit Rs 24,000 crore in gross written premium for FY27, aiming to move up from the roughly Rs 20,400 crore projected for FY26. The stretch goal for FY28? Rs 30,000 crore. “We are expanding into the smaller towns and villages,” he added. ETHealthworld.com
The new offerings will rely on a tighter hospital network to keep premiums lower. Roy called it a “preferred network of partners.” Customers willing to stick to a shorter list of hospitals may see cheaper rates, with most of the distribution handled by agents and digital platforms. The Economic Times
Star Health reported that it settled Rs 1,254 crore worth of claims in Andhra Pradesh and Telangana for FY26, handling 1.8 lakh cases—a 24% jump over last year’s Rs 1,014 crore. Gross written premium in the region climbed 17% to Rs 2,268 crore. Policies issued also ticked up, reaching 9.4 lakh compared with 8.8 lakh previously. The Times of India
Across India, the company paid out Rs 11,903 crore, settling 30.6 lakh claims in FY26. Its hospital network now tops 15,000, and 75% of claims ran through its digital platform, according to the company. The Times of India
Conditions are looking better. Star Health posted a profit after tax of Rs 911 crore for FY26, marking a 16% increase from a year earlier. The company also reported its combined ratio dropped to 98.8%, down from 101.1%. That metric, which pits claims plus expenses against premium income, typically means an underwriting profit when it stays below 100%. PR Newswire
Star Health is wading further into an already fierce health-insurance market. For the year ending March, IRDAI’s provisional data pegged gross direct premium from stand-alone private health players at Rs 45,865.95 crore—a 19.4% jump. Care Health led with Rs 10,031.31 crore in premiums, followed by Niva Bupa at Rs 8,585.93 crore. ICICI Lombard, which straddles several insurance segments including health, posted Rs 28,712.46 crore. IRDAI
Star Health is facing scrutiny over a separate claims dispute that could put its approach to customer issues under the microscope. The District Consumer Disputes Redressal Commission in Thrissur found the company at fault after it denied a Corona Rakshak policy claim. The policyholder’s hospitalization lasted just under 72 hours—nearly 70 hours—falling short of the stated threshold, but the commission still held Star Health liable.
The commission ruled that missing the 2.5-hour window didn’t amount to a fundamental breach, saying a strictly technical reading of the policy would undermine its intent. Star Health was directed to pay Rs 1 lakh to cover the insured sum, plus Rs 10,000 in compensation and Rs 5,000 toward litigation costs, all carrying 9% annual interest from the day the complaint was filed.
There’s a catch: lower-cost plans depend on hospitals sticking to agreed rates and customers putting up with narrower networks. Rising medical expenses or clashes over limited hospital options could threaten those savings. The Thrissur order highlights another risk—consumer forums don’t always side with insurers on strict claims. The Economic Times
Roy pointed to technology spending as a lever for trimming operating costs and improving claims—think stricter hospital pricing, product tweaks, and sharper fraud controls. FY26 is being billed by the company as a year for “disciplined execution.” The immediate challenge, though, is more fundamental: can they push lower-cost policies without making claims tougher for customers? The Economic Times
