indian doctors doing traditional ayurvedic oil foot massage | Photo Credit: vkph

My parents are interested in Ayurvedic treatment. With a regular health insurance for them, I am concerned about how claims in Ayurvedic treatment will be handled. Can you please explain what to look for in Ayush related claims in health insurance?

Preethi

Health insurance in India has evolved significantly over the past few years. Beyond conventional medical treatment, insurers today also provide coverage for AYUSH treatments-Ayurveda, Yoga & Naturopathy, Unani, Siddha, and Homeopathy, giving policyholders greater freedom to choose the system of medicine best suited to their needs. IRDAI has progressively strengthened the regulatory framework for AYUSH coverage, including issuing dedicated guidelines in January 2024 to promote broader and more consistent coverage across health insurance products.

However, despite this regulatory push, AYUSH-related claim disputes continue to arise. In most cases, disputes stem not from the exclusion of AYUSH treatment, but from policyholders’ lack of awareness of policy conditions or the treatment failing to meet the insurer’s admissibility criteria.

One of the most common reasons for disputes is that policyholders assume every policy provides AYUSH coverage up to the full sum insured. While many newer products do offer broader coverage, several older policies still carry sub-limits. For instance, a health policy with a sum insured of ₹10 lakh may restrict AYUSH treatment to only ₹2 lakh. If policyholders do not review the policy wording carefully, they may discover this limitation only at the time of claim settlement.

Another frequent issue is the choice of treatment facility. Health insurance generally covers NABH AYUSH treatment only when it is received at a recognised AYUSH hospital or healthcare facility that meets the prescribed regulatory requirements, including applicable accreditation standards. Wellness centres, spas, rejuvenation retreats, or facilities offering general therapies without meeting the prescribed standards are typically not eligible for insurance reimbursement. IRDAI has defined the requirements for an AYUSH hospital, including infrastructure, qualified practitioners, in-patient facilities and the maintenance of medical records.

The treatment itself must also follow recognised AYUSH protocols and be medically indicated. Claims may be questioned if the treatment is primarily for wellness, preventive care or lifestyle improvement rather than for a diagnosed medical condition requiring hospitalisation.

Documentation is another area where policyholders often face difficulties. Incomplete admission records, missing prescriptions, inadequate discharge summaries, or improperly prepared bills can delay or even result in rejection of the claim. As with any health insurance claim, maintaining complete and accurate medical documentation is essential for smooth claim processing.

Pricing also plays an important role. There have been instances of AYUSH centres charging rates significantly higher than the applicable rates specified by IRDAI. Where hospitals levy charges that are considered unreasonable or exceed the insurer’s admissible limits, disputes may arise regarding the payable amount. The insurer may settle only the amount deemed reasonable and admissible under the policy, leaving the policyholder to bear the balance.

How can consumers avoid such disputes?

Before undergoing AYUSH treatment, policyholders should:

●    Read the policy wording carefully to understand whether any AYUSH-specific sub-limit applies.

●    Confirm that the treatment will be taken at a recognised AYUSH hospital or authorised healthcare facility.

●    Seek pre-authorisation from the insurer wherever cashless treatment is available.

●    Prefer network hospitals with existing cashless tie-ups, as these reduce documentation issues and improve claim experience.

●    Retain all prescriptions, investigation reports, bills, discharge summaries, and other medical records.

●    Clarify any doubts regarding admissibility with the insurer before beginning treatment rather than after hospitalisation.

AYUSH has become an important part of India’s healthcare ecosystem, and insurance coverage has expanded accordingly. Yet, awareness has not kept pace with the evolving regulatory norms. A little diligence before starting treatment understanding the policy, selecting the right hospital, and obtaining pre-authorisation can help policyholders avoid unnecessary disputes and ensure they receive the benefits to which they are entitled under their health insurance policy.

The author is Co-Founder & COO, Insurance Samadhan

Published on October 17, 2026