Insurers Redesign Health Policies to Tackle Rising Medical Inflation

As of November 13, 2025, rising medical inflation in India has prompted insurers to move away from uniform health policies toward more modular and personalized plans. According to National Health Accounts data, medical inflation in India has averaged 12-14% annually, outpacing general inflation and eroding household budgets.

To address this challenge, insurers are now focusing on customized offerings that allow customers to select specific features, such as outpatient care, wellness rewards, or chronic care support, aligning coverage with individual requirements and budgets. This trend is being driven by diverse healthcare needs and the increasing adoption of digital tools.

Insurers are leveraging technology and data analytics to balance flexibility and cost in these modular health plans. AI-backed risk assessment and flexible payment structures enable them to tailor coverage without adding unnecessary expenses. Digital interfaces also allow customers to compare plans and make informed choices.

Industry experts note that while insurers are ready with these personalized options, consumer readiness and product clarity remain key to wider adoption. As the market transitions from generic to need-based health insurance, insurers are emphasizing responsible customization, where additional benefits are linked to verified health data and preventive care to ensure long-term financial security.