Health insurance priority for government, to cover all by 2033: Nirmala Sitharaman

New Delhi: Health insurance is a priority for this government and it is expected that the country will have insurance for all by 2033, Finance Minister Nirmala Sitharaman said in the Rajya Sabha on Tuesday.

Replying to supplementary queries during Question Hour, she said the insurance sector is expanding and during 2024-25 it covered 58 crore lives in the country.

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"Health insurance is a priority for this government. In fact, we are hoping that by 2033 we will have insurance cover for all," she said.

In December 2025, the minister said the government came up with a Bill to hike FDI in the insurance sector with an aim to increase its penetration and deepen the market.

She said insurance regulator IRDAI notified rules for the rural social sector and third-party obligations in 2024 to increase penetration in rural areas.

"...if you are looking at insurance in general, we have a challenge in that," she said adding the per capita premium is only USD 97 whereas the global average is USD 943.

"While penetration remains low, the government is actively bridging this gap through targeted reforms and affordability measures. Health insurance is now a clear priority with GST exemption on individual premiums, expansion of coverage and strong regulatory push driving the momentum," the finance minister said.

Noting that health insurance is actually rapidly expanding as a market, she said, "today the sector has already scaled significantly, reaching Rs 1,17,505 crore in 2024-25 and covering 58 crore lives, with balanced contributions from public, private and standalone insurers."

"Public sector insurers particularly through health premiums, give cover of worth Rs 42,420 crore, private sector does Rs 37,752 crore and standalone health insurance companies are doing Rs 37,331 crore," Sitharaman said, adding that for the poorest of the poor there is PM Jeevan Jyoti Bima Yojana.

Most importantly, she said, PM Jeevan Jyoti Bima Yojana offers protection at just Rs 436 per year for Rs 2 lakh cover, ensuring even the most vulnerable are not left behind.

"With 26.79 crore enrolments and proven responsiveness during COVID, India is steadily building a more inclusive, accessible, and resilient health insurance ecosystem," she noted.

The minister said private sector insurance companies as well as public sector companies are all very systematically and methodically regulated by the insurance regulator. "If there are any wrongdoings by insurance companies, the regulator acts upon them."

In the last three years, there have been several instances where insurance companies, when found in violation of the law, have been taken to task, she said adding fines of Rs 1-2 crore were imposed on many private insurers.

"If there is undue influence by insurance companies using their dominant position, or when they make false and misleading claims, misrepresent facts, omit key features while selling insurance, or fail to ensure suitability of the policy, all such acts of omission and commission are acted upon.

"For instance, in 2023-24, a penalty of Rs 2 crore was levied on Reliance General Insurance Company for unfair business practices. Similarly, penalties have been imposed on other companies including Bajaj Finance Ltd - Rs 2 crore, HDFC Life Insurance - Rs 2 crore, SBI Life Insurance - Rs 1 crore, and Royal Sundaram General Insurance - Rs 1 crore," she informed the House.

In her written reply to the question, the finance minister said, "In India, as informed by Insurance Regulatory and Development Authority of India (IRDAI), for FY 2024-25, there were 251.85 lakh individual health insurance policies, which include family members as well, covering 6.01 crore people. Further, there are 13.05 lakh group health insurance policies, covering 27.51 crore members."

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She said Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) provides health insurance coverage of Rs 5 lakh per family per year for secondary and tertiary care hospitalization to 12 crore families, constituting the bottom 40 per cent of India's population.

"In October 2024, the scheme was further expanded to cover 6 crore senior citizens of age 70 years and above belonging to 4.5 crore families irrespective of their socio-economic status. As on 28.02.2026, a total of 43.52 crore Ayushman cards have been created across the country.