Rise Seen In Health Insurance Coverage Across India, Says NFHS-6: What This Means

Health insurance coverage in India has seen a significant jump, according to the latest National Family Health Survey (NFHS-6). The survey found that 60.2% of Indian households now have at least one member covered by a health insurance or health financing scheme, up from 41% in NFHS-5 (2019-21). Experts say this nearly 20-percentage-point increase reflects the growing reach of government-backed schemes and greater awareness of financial protection against medical expenses. While the rise is encouraging, healthcare economists note that insurance coverage alone does not guarantee affordable or quality healthcare, making continued improvements in access, claim settlement, and healthcare infrastructure equally important.

What Did NFHS-6 Find?

One of the most notable findings of NFHS-6 was the expansion of health insurance coverage across the country. "The positive results reported by NFHS-6 showing the increase in the number of people with health insurance coverage in India are indeed encouraging. Healthcare-related problems have been known to cause major financial difficulties for families and individuals. Thus, the increasing number of people opting for health insurance means that people are becoming more aware of the importance of protection against unforeseen circumstances," says Siddharth Maurya, Managing Director, Vibhavangal Anukulkara Pvt Ltd.

"It needs to be mentioned that health insurance cannot be considered only as a healthcare service anymore. Health insurance becomes an important part of financial planning since even a single visit to the hospital might significantly affect your savings or plans for the future. Higher insurance penetration leads to lower out-of-the-pocket expenses and saves one from depleting emergency resources or incurring debts due to unforeseen hospital visits," adds Maurya. According to the survey:

• 60.2% of households reported having at least one insured member
• Coverage increased substantially from 41% recorded in NFHS-5
• Financial protection indicators improved alongside gains in maternal and child healthcare services

The survey covered nearly 6.79 lakh households across 715 districts, making it one of India's largest health datasets.

Why Is Health Insurance Important?

According to Arun Ramamurthy, Co-founder, Staywell Health, The National Family Health Survey (NFHS-6) states there has been a noticeable increase in citizens who now have health insurance throughout India, which represents the positive development of health care and financial protection systems; it also means that more and more individuals and families understand the importance of buying health insurance to protect against unexpected healthcare expenses.

Also read: Health Insurance Coverage Triples In Rural India, Social Security Spend Sees Jump: Government Data

"Having health insurance can greatly reduce a household's total out-of-pocket expense for healthcare, which many families continue to incur; it also provides the household with access to healthcare, preemptive care, and quality care without creating the level of financial strain typically associated with obtaining necessary medical services in India. In India, the high cost of healthcare can impede a household's ability to build financial security and save for their future," Ramamurthy adds. Health insurance helps reduce out-of-pocket spending when families face:

• Hospitalisation
• Surgery
• Chronic disease treatment
• Emergency medical care

Without adequate coverage, unexpected medical expenses can push households into financial distress. Public health experts say expanding insurance is an important step toward reducing catastrophic healthcare spending.

What May Have Driven The Increase?

Experts attribute the growth to several factors, including:

• Expansion of government health protection programmes
• Greater awareness of health insurance benefit 
• Increased enrolment in public insurance schemes
• Wider healthcare outreach following the pandemic

NFHS-6 specifically noted improvements in financial healthcare protection alongside gains in maternal and child health indicators.

Does Insurance Coverage Mean Everyone Is Fully Protected?

Health policy experts point out that insurance coverage can vary widely in terms of:

• Sum insured
• Covered treatments
• Hospital networks
• Claim approval rates
• Out-of-pocket expenses not covered by policies

Having insurance is an important first step, but the adequacy of coverage remains equally important.

Other Positive NFHS-6 Health Findings

The survey also reported improvements in several key health indicators, including:

• Higher institutional delivery rates
• Better immunisation coverage among children
• Improvements in child nutrition indicators
• Increased antenatal care coverage for pregnant women

At the same time, the report highlighted emerging concerns such as rising obesity and lifestyle-related diseases.

Also read: Rising Medical Costs? How Getting The Right Insurance Coverage Can Save Your Health And Your Bank Balance

What Does This Mean For Indian Families?

The rise in insurance coverage suggests that more families now have some financial protection against medical emergencies than they did a few years ago. Experts say this could help reduce healthcare-related financial hardship and encourage earlier access to treatment. However, they also stress the need for stronger healthcare systems, wider awareness of policy benefits, and improved access to quality care to ensure that insurance translates into real health security.