Standalone health insurer

What is a standalone health insurer?

A standalone health insurer, often shortened to SAHI, is an insurance company registered by IRDAI to carry on health insurance business only. It sells hospitalisation, critical illness, personal accident and travel products, but it cannot sell motor, fire, marine or life insurance. General insurers can also sell health insurance alongside their other lines, so a SAHI competes with them while being focused on one class of business.

The category exists because the Insurance Act, 1938 allows an Indian insurance company to have health insurance business as its sole purpose. The Act defines health insurance business as contracts that provide sickness benefits or pay medical expenses, and expressly includes personal accident and travel insurance.

Standalone health insurers in India

With the registration of Prudential HCL Health Insurance in July 2026, India has eight standalone health insurers. Premium figures for FY 2025 to 26, from industry data compiled by Cafemutual:

Prudential HCL is a joint venture in which Prudential holds the majority and the HCL Group holds 30%.

How standalone health insurers are regulated

• Capital. A SAHI needs minimum paid-up equity capital of ₹100 crore, the same as a life or general insurer.
• Expenses. Under the Expenses of Management regulations, 2024, a SAHI's total expenses, commission included, may be up to 35% of gross written premium, against 30% for general insurers. IRDAI's September 2026 consultation paper proposes a lower, phased limit for all non-life insurers, measured on domestic gross direct premium.
• Products. Health products are launched through use and file. IRDAI's health master circular of May 2024 sets product and servicing rules, and its policyholder protection master circular sets cashless authorisation timelines.
• No composite. A SAHI cannot add life or general lines; India has no composite licence.

In August 2026, IRDAI barred Niva Bupa Health from opening new places of business for six months for exceeding EoM limits in FY 2024 to 25, showing that the expense ceiling is enforced against SAHIs too.

What standalone health insurers mean for distribution

• Health-only focus suits specialist agents. Retail health needs explanation at sale, service at renewal and support at claim time, so SAHIs put weight on individual agents alongside banks, brokers and digital partners. Agents who specialise in health can build a steady renewal book with them.
• Higher expense room. The 35% EoM ceiling has given SAHIs more room than general insurers to pay distributors and fund growth. If IRDAI's 2026 proposals cut that room, SAHI commission structures and incentive programmes are likely to change.
• Retail-led mix. SAHIs tend to be strongest in retail family floater and individual policies, while general insurers dominate group health. Brokers placing large employer schemes usually work more with general insurers, but SAHIs compete in the SME segment.
• Claim experience drives renewals. In health, a smooth cashless claim or a fair reimbursement decides whether a customer renews. Distributors should track each partner's claim service, hospital network and grievance record, not only commission.
• GST exemption helps retail sales. Since 22 September 2025, individual health policies, including family floaters, are exempt from GST, which reduced the price customers pay on SAHIs' core retail products.