Star Health Reports Significant Growth in Health Insurance Demand Post-GST Reduction
Chennai-based Star Health and Allied Insurance Company has experienced a remarkable 50% surge in demand for new health insurance policies following the recent GST rate cut, according to Managing Director and CEO Anand Roy. This substantial increase highlights a positive market response to the tax reduction, which has made health insurance more affordable for consumers.
Increased Coverage and Customer Retention
In addition to the spike in new policy acquisitions, the average sum insured coverage for these new policies has risen by approximately 25%, translating to an increase of around Rs 2 lakh. Roy noted that the coverage jumped from about Rs 9 lakh to Rs 11 lakh after the GST waiver. This trend indicates that customers are not only purchasing more policies but are also opting for higher protection levels, leveraging the savings from reduced premiums.
Roy explained the customer behavior shift: "Many policyholders are choosing enhanced coverage because if someone paid Rs 20,000 as a premium last year, their premium is now Rs 17,000 due to the 18% GST waiver. They are still willing to pay Rs 20,000 but are directing the savings toward increased insurance coverage."
Business Growth and Financial Projections
The company has also seen its renewal retention rate improve by more than 2%, contributing to overall stability and growth. Roy projected that Star Health expects to achieve around Rs 20,000 crore in business revenue this year, covering more than 2.5 crore lives across the country in the retail segment. He emphasized that nearly 95% of the company's business is concentrated in the retail sector, underscoring its focus on individual consumers.
As of January 2026, the company's gross written premium (GWP) stood at Rs 17,800 crore, reflecting a strong financial position. Roy made these statements during a press conference after launching 32 Arogya Seva Kendra's (ASK) across nine states under its corporate social responsibility (CSR) program. These centers aim to provide structured primary care services free of cost to patients, furthering the company's commitment to healthcare accessibility.
Industry-Wide Impact and Future Outlook
Roy highlighted that the growth in demand is not limited to Star Health alone, with the entire health insurance industry witnessing a similar uptick. He stated, "There is at least a 50% improvement in growth and in terms of demand from the market. Demand from new customers, who are buying policies, has gone up by almost 50% for the industry." This suggests a broader positive effect of the GST reduction on the sector, potentially leading to increased insurance penetration and better financial protection for more individuals.
The combination of reduced GST rates and strategic initiatives like the ASK centers positions Star Health to capitalize on growing health awareness and economic factors. The company's focus on retail and enhanced coverage options aligns with consumer trends toward securing comprehensive health safeguards in an evolving economic landscape.
