Costly Treatment, Complicated Insurance: The Common Man’s Double Burden

The complexities, opacity, and arbitrariness increasingly visible in the insurance sector have dealt a deep blow to public trust. Insurance, which ought to serve as a means of protection, is in many cases turning into an instrument of exploitation. At a time when the cost of medical services has risen dramatically, treatment in private hospitals often runs into lakhs of rupees. Hospitals built on subsidized land provided by the government are, ironically, seen compromising the health rights of the poor. In such a scenario, health insurance emerges as a necessary shield. However, insurance companies often capitalize on fear and uncertainty about the future to persuade people into purchasing policies.

The real problem surfaces when policyholders actually need support. At the time of claim settlement, companies frequently invoke technicalities, conditions, and exclusions to avoid payouts. Various reports indicate that claims worth thousands of crores are rejected every year. This is not only alarming but also raises serious questions about the credibility of the insurance system. Often, customers are not fully informed about policy terms at the time of purchase. The complex language of policy documents remains beyond the understanding of the average person, and later, the same clauses are used to deny claims.

Another critical concern is the possible nexus between private hospitals and insurance companies. In many instances, hospitals inflate bills while insurers underpay, leaving patients to bear a heavy financial burden. This situation is especially distressing for the middle and lower-income groups. There have even been instances where hospitals have withheld the bodies of deceased patients over unpaid dues—an act that stands in stark violation of human dignity. In developed countries, insurance systems tend to be more transparent and accountable, with claims settled in a timely and fair manner. In India, regulatory bodies such as the Insurance Regulatory and Development Authority of India (IRDAI) exist to oversee and balance the sector, but their effectiveness is often questioned at the ground level. Limited intervention or regulatory inertia allows arbitrary practices by insurance companies to persist.

To address these challenges, the first step must be to simplify and enhance transparency in insurance processes. Policy documents should be presented in plain language so that an ordinary person can understand them. Insurance agents must be held accountable for providing complete and accurate information, and strict action should be taken against mis-selling. Secondly, the claims settlement process needs to be streamlined. A standardized and time-bound mechanism should be implemented. If a claim is rejected, clear and justified reasons must be provided. An independent appellate system should also be established to ensure that consumers can seek prompt redressal.

Thirdly, transparency between hospitals and insurance companies is essential. A standardized pricing system for treatments can help curb excessive billing and financial exploitation. Additionally, the cashless treatment facility must be strengthened and expanded to provide immediate relief to patients. Fourthly, the government must take a proactive role. A national-level monitoring system should be instituted to oversee the functioning of both insurance companies and hospitals. Regular audits and investigations should expose irregularities, and strict action must be taken against those found guilty. Fifthly, enhancing insurance literacy is crucial. Awareness campaigns in both rural and urban areas should educate people about policy terms, rights, and procedures. Simple guides and support centers should be established, particularly for the poor and less educated sections of society.

Undoubtedly, the insurance business should not be viewed merely as a profit-making enterprise but as a vital pillar of social security. Until ethics, transparency, and accountability are ensured, public trust cannot be restored. The need of the hour is to restructure the insurance system to make it truly people-centric. Simplified processes, clear rules, a robust regulatory framework, and informed consumers—these four pillars can guide the sector in the right direction. If timely reforms are not implemented, insurance may continue to be a source of distress rather than protection for the common man. Healthcare and insurance—both fundamentally associated with the protection, relief, and service of human life—are, paradoxically, becoming increasingly complex, expensive, and unreliable for the common citizen. On one hand, private hospitals built on subsidized land are seen evading their responsibility to provide free treatment to the poor. On the other hand, insurance companies impose such conditions and procedures that accessing benefits becomes difficult at the time of need. This situation reflects not just administrative failure but a deeply insensitive system.

The issuance of notices by the Supreme Court to hospitals built on subsidized land in Delhi is not merely an administrative action but a mirror to the system. When hospitals accept subsidized land with a commitment to treat the poor, it is not a mere formality but a social obligation. Unfortunately, while these institutions enjoy the benefits, they often evade their responsibilities. A similar pattern is visible in the insurance sector, where lofty promises are made during policy sales, but claims are denied on technical grounds. An ordinary citizen continues to pay premiums for years, yet receives little support when it is most needed. In this context, judicial intervention is a positive sign. Just as the Court has sought accountability from hospitals, there is an equally urgent need for strict oversight and clear regulations governing insurance companies, so that insurance truly serves as a safeguard rather than a profit-driven trap.

The responsibility of governments must extend beyond policy formulation to strict enforcement. Hospitals that fail to honor their commitments despite receiving subsidized land should either be made to pay market value or face reconsideration of their licenses. Similarly, insurance companies must ensure that claim processes are simple, transparent, and time-bound. Healthcare and insurance are intrinsically linked to the security of human life; therefore, unchecked profiteering in these sectors must be curbed. If the government, judiciary, and regulatory authorities act collectively to enforce transparency and accountability, public trust can be restored. Otherwise, these sectors risk devolving into mere commercial enterprises, leaving the poor trapped between unaffordable healthcare and ineffective insurance.