Health Insurance Renewals Hit Record High in FY26 — Why Consumers Are Going Back
Health insurance renewals in FY26 reached a record high. Explore why consumers are renewing — modular plans, cumulative bonuses, and rising awareness.
🕘 Introduction
In FY26, India’s health insurance renewal rate reached its highest level in history. According to a Times of India report, more than 80% of policyholders chose to renew their existing health insurance plans.
This marks a major shift in consumer behavior — people are valuing long-term coverage, no-claim bonuses, and tax benefits under Section 80D more than ever before.
📊 The Data: Renewals Hit Record High in FY26
According to IRDAI and leading insurers, renewals have surged by 20–25% compared to FY25.
Insurers like Star Health, Niva Bupa, and HDFC Ergo reported record persistency ratios, meaning customers are continuing rather than switching policies.
“Policy renewals are now a strong indicator of consumer trust,” said an IRDAI spokesperson.
Key Statistics:
Renewal rates: 80–85% in FY26
New policies issued: +12% growth YoY
Persistency ratio for health insurers: +7% improvement
💡 Top Reasons Behind the Renewal Boom
1. Modular & Customizable Plans
Insurers have started offering modular plans — allowing customers to choose add-ons like maternity, critical illness, or wellness benefits.
This flexibility makes policyholders more likely to continue with the same insurer instead of switching.
2. Cumulative Bonus & Loyalty Benefits
Renewing policies brings increased coverage without higher premiums through cumulative bonuses.
For instance, after five years without a claim, your sum insured can increase by up to 100%, which is a huge incentive for renewals.
3. Rising Health Awareness Post-Pandemic
COVID-19 completely changed how Indians view healthcare.
People now understand the importance of continuous coverage, particularly for lifestyle diseases like diabetes and hypertension.
4. Easier Digital Renewals
Insurers have made renewal processes super easy — through mobile apps, WhatsApp, and UPI-based payments.
The convenience has directly contributed to higher renewal rates in FY26.
5. Upgrading Instead of Switching
Rather than canceling policies, many customers now upgrade to higher coverage or add riders.
This trend keeps renewal numbers high and reduces churn for insurers.
⚠️ Challenges That Still Exist
Despite the positive trend, there are challenges:
Premium inflation: Average annual premium increased by 8–10% in FY26.
Dropouts in older age groups: Higher premiums for 60+ policyholders lead to cancellations.
Limited awareness of portability options.
Still, the overall renewal sentiment remains strong.
🏦 What Insurers Are Doing Differently
Launching loyalty discounts for consistent renewals.
Offering wellness rewards through fitness apps.
Introducing AI-driven renewal reminders and easy claim settlement features.
Providing tax-saving certificates for Section 80D benefits at renewal.
Example:
HDFC Ergo now offers “Renewal Plus Bonus” — a 10% premium discount for customers who renew for 3 consecutive years.
🧭 Tips Before You Renew Your Health Insurance in 2025–26
✅ Compare premium vs. benefits — check if your coverage matches inflation.
✅ Review exclusions — ensure pre-existing diseases are covered.
✅ Update dependents — add family members if needed.
✅ Ask for cumulative bonus confirmation.
✅ Claim Section 80D tax deduction — up to ₹25,000 for self/family and ₹50,000 for parents.
🏥 Future Outlook: FY27 & Beyonde in 2025–26
Experts predict renewals will continue to rise as:
Awareness of chronic diseases increases
Middle-class spending on healthcare rises
IRDAI pushes for portable & simplified policies
By FY27, India may see 90% renewal rates among urban policyholders.
🧾 Frequently Asked Questions (FAQ)
1. Why are health insurance renewals important?
Renewing on time ensures uninterrupted coverage and continued benefits like the cumulative bonus.
2. Can I switch insurers at renewal time?
Yes, under IRDAI’s portability rule, you can transfer your policy without losing benefits.
3. Do renewals help in tax savings?
Absolutely. Premiums paid during renewal qualify for Section 80D tax deduction.
4. What happens if I miss my renewal date?
Most insurers give a grace period of 30 days, but if missed, policy benefits lapse.
🔗 Useful Links
Internal Links (for ClaimWeb):
External Links:
🎯 Conclusion
FY26 has proven that health insurance is no longer optional — it’s essential.
The record-high renewal rates show how Indians are taking long-term health and financial security seriously.
If you haven’t renewed your plan yet, now is the time — protect your health, secure your savings, and enjoy continued coverage.
