Rapid Digitalisation and Expanding Coverage Driving India’s Health Insurance Sector Despite Challenges in Awareness and Affordability, Aon Report

  Aon plc (NYSE: AON), a leading global professional services firm, released insights for India from its inaugural 2025 Insurer Wellbeing Benchmarking Report, offering a comprehensive analysis of the health and wellbeing services provided by insurers across India. The report highlights both the breadth of services available and the critical gaps that remain in delivering measurable employee health and wellbeing outcomes and employee satisfaction.

The report is based on a survey of six insurers in India, evaluating more than 600 data points across 10 key wellbeing domains, including telemedicine, mental health, employee assistance programmes (EAPs), health screenings and case management.

Compared to regional peers, India’s health insurance landscape reflects rapid digitalisation and expanding coverage, yet faces challenges in awareness, standardisation and affordability. Competitive pressures have led insurers and brokers to adopt data-driven plan design, embedded wellbeing services and cost containment strategies. Despite the increased market competition, only 50 percent of insurers provided customisation support to clients with more than 1,000 employees compared to 92 percent of insurers in China.

“India’s health insurance market is at a pivotal moment, with rising expectations from employers and employees alike,” said Susan Fanning, head of APAC wellbeing solutions for Aon. “The findings from the report highlight the need for insurers to innovate, customise and build stronger partnerships to deliver measurable outcomes while managing costs. By aligning more closely with employer priorities of workforce health, cost sustainability and measurable outcomes, insurers can play a significant role in building a resilient, future-ready health benefits ecosystem for their workforce.”

Key Highlights:

Telemedicine adoption is expanding

Eighty three percent of insurers surveyed in India now offer telehealth services, providing employees of their clients with access to general practitioners, chronic disease management, e-prescriptions and medication delivery. However, the impact on outpatient healthcare claims appears limited, with only one-third of insurers surveyed reporting tangible savings, with reductions ranging from just 1.1 percent to 1.5 percent. While overall utilisation of telehealth remains moderate, 40 percent of insurers surveyed have achieved engagement rates exceeding 30 percent, and 60 percent observed a notable increase in usage, rising by six to 10 percent between 2022 and 2024.

These findings suggest that while telehealth adoption is progressing, its full potential for driving healthcare cost savings and widespread usage is yet to be realised, highlighting opportunities to strengthen integration with other wellbeing programmes and improve client education.

Employee assistance programmes (EAPs) and mental health support is growing, but gaps remain

Sixty seven percent of insurers surveyed in India offer EAPs through phone, online platforms and mobile apps, catering to a linguistically diverse workforce with services available in English, Hindi and, to varying degrees, additional regional languages. However, EAP engagement is inconsistent, with utilisation rates ranging from one percent to as high as 50 percent and growth in usage between six percent and 40 percent from 2022 to 2024. Most EAPs focus on wellbeing coaching and work-life balance, while more comprehensive services such as legal assistance or substance abuse support are less common.

Mental health services are also gaining traction, with 50 percent of insurers surveyed providing features like wellbeing assessments, self-help tools and resilience training. While language support is relatively broad, deeper localisation and integration with other health programmes remain limited.

Most insurers surveyed report modest utilisation for mental health services, with 67 percent experiencing engagement rates between 11 percent and 20 percent. These trends highlight both the expanding scope and persistent gaps in mental health and wellbeing support, underscoring the need for greater integration, broader service offerings and improved awareness to drive meaningful employee engagement and outcomes.

Health screenings have low uptake and need integration

Health screenings across Indian insurers show both untapped potential and current underutilisation. Although half of the surveyed insurers provide health screening services ranging from basic to comprehensive and specialist tests, employee uptake remains low to moderate.

One insurer reported claims savings exceeding 5.1 percent from health screening initiatives, highlighting the value of early detection in controlling costs and enhancing employee wellbeing. This benefit is not widely realised across the market, suggesting a need for greater awareness and incentivisation.

Only 33 percent of insurers surveyed have established case and specialist disease management programmes, primarily focusing on chronic conditions such as musculoskeletal and cardiovascular diseases. onsite clinics are available through two out of six insurers surveyed, providing convenient immediate care for common health concerns. although utilisation fluctuates and consistent claims savings have yet to be demonstrated.

Ashley DSilva, head of health and wealth solutions, India for Aon, said: “India’s health insurance market is undergoing rapid transformation, driven by ambitious initiatives like Ayushman Bharat and progressive reforms by the Insurance Regulatory and Development Authority of India with a singular focus on expanding coverage to newer population segments. We are seeing employers increasingly prioritising mental health, chronic disease management and financial wellbeing as essential components of their core benefits. To stay ahead, insurers must broaden their approach by harnessing predictive analytics and offering greater customisation flexibility for large employers.”