The following details are based on information shared by Policybazaar.
What is EMI in health insurance?
Under the EMI model, policyholders can split their insurance premium into smaller instalments, monthly, quarterly, or half-yearly, rather than paying the entire amount upfront.
The payment is typically automated through an e-mandate or standing instruction linked to a credit card, debit card, or bank account. Once activated, the instalment amount is automatically deducted on the due date.
According to Policybazaar, the feature is intended to improve affordability and make health insurance more accessible for customers who may not want to pay a large premium amount upfront.
What is the difference between Standard EMI and Accelerated EMI?Standard EMI
This is generally available for one-year health insurance policies.
In this structure, the annual premium is divided into equal instalments spread across the policy period. For example, a ₹12,000 annual premium could be paid as ₹1,000 per month over 12 months, subject to any applicable interest charges.
Accelerated EMI
Accelerated EMI is being offered on select multi-year health insurance plans.
Under this structure, customers buying a multi-year policy can pay the total premium amount through instalments compressed into the first year itself, instead of making a lump-sum payment at the time of purchase.
According to Policybazaar, the model allows customers to secure multi-year coverage without a large one-time outflow.
Which insurers offer Accelerated EMI?
Policybazaar said Star Health and Care Health Insurance currently offer Accelerated EMI options on select multi-year health insurance plans.
Separately, insurers including HDFC ERGO, ICICI Lombard, Niva Bupa, ManipalCigna, Aditya Birla Health Insurance, Bajaj Allianz General Insurance and Digit offer EMI facilities primarily on one-year policies, according to the company.
How many instalments are involved?
The number of instalments depends on the payment frequency selected by the customer.
- Monthly mode: 12 instalments
- Quarterly mode: 4 instalments
- Half-yearly mode: 2 instalments
For Accelerated EMI structures linked to multi-year policies, the total premium is generally recovered within the first year.
Does EMI increase the cost of insurance?
Policybazaar said there is usually no major change in the premium amount under EMI structures for most insurers.
However, in some cases, a marginal interest component of up to around 10% may apply depending on the insurer or payment arrangement.
What happens if a customer files a claim before completing all instalments?
According to Policybazaar, the claims adjudication process remains the same as for policies where the premium has been paid upfront.
This means customers who have paid only a few instalments may still be eligible to file claims, provided the policy remains active.
What if an EMI payment is missed?
Policybazaar said insurers generally provide a grace period of 15 to 30 days, depending on the payment frequency.
If the missed instalment is paid within the grace period, the policy continues with accrued benefits intact. Failure to pay within the grace period could result in the policy lapsing.
Why are insurers offering EMI options?
Experts say EMI-based payment structures are part of broader efforts to improve insurance affordability and penetration in India.
Multi-year policies can help customers maintain uninterrupted coverage while potentially insulating them from annual premium hikes. Accelerated EMI models are being positioned as a way to combine long-term coverage with lower upfront financial commitment.
Experts, however, advise customers to review the total payable amount, any applicable interest charges, and the implications of missed instalments before opting for EMI-based insurance plans.
