My parents are interested in Ayurvedic treatment. With a regular health insurance for my parents, 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. The IRDAI has progressively strengthened the regulatory framework for AYUSH coverage, including issuing dedicated guidelines in January 2024 to promote wider and more consistent coverage across health insurance products.
However, despite this regulatory push, AYUSH-related claim disputes continue to arise. In most cases, the dispute is not because AYUSH treatment is excluded, but because the policyholder is unaware of the policy conditions or the treatment does not meet the insurer’s admissibility criteria.
Reasons for dispute
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 continue to carry sub-limits. For instance, a health policy with a sum insured of ₹10 lakh may restrict AYUSH treatment to only ₹2 lakh. Unless the policy wording is carefully reviewed, this limitation often comes as a surprise 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 taken at a recognised NAPBH-approved AYUSH hospital or healthcare facility that meets the regulatory requirements. Wellness centres, spas, rejuvenation retreats or facilities offering general therapies without meeting the prescribed standards are typically not eligible for insurance reimbursement. The IRDAI has clearly defined what constitutes an AYUSH hospital, including requirements relating to infrastructure, qualified practitioners, inpatient facilities and maintenance of medical records.
The treatment itself must follow recognised AYUSH protocols and be medically indicated. Claims may be questioned where the treatment appears to be primarily for wellness, preventive care or lifestyle improvement rather than for managing a diagnosed medical condition requiring hospitalisation.
Documentation is another area where policyholders often face difficulties. Incomplete admission records, missing prescriptions, inadequate discharge summaries, or improper bills can delay or even result in rejection of the claim. As with any health insurance claim, maintaining complete and accurate medical records is essential.
Pricing also plays an important role. We have observed instances where certain AYUSH centres charge significantly higher rates than those specified by the 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 considered reasonable under the policy terms, 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 regulation. 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 that they receive the benefits they are entitled to under their health insurance policy.
The writer Co-Founder and COO, Insurance Samadhan
Published on August 22, 2026
