Hospital network tops priority as millennials, Gen Z drive health insurance uptake: Survey

India’s young consumers are increasingly recognising the importance of health insurance, with 61% of millennials and Gen Z expressing a preference to invest in personal health coverage, according to HDFC ERGO General Insurance’s latest survey, Exploring Gen Z and Millennials Mindset Towards Insurance.

Conducted by NielsenIQ across 17 tier 1 and tier 2 cities, the survey highlighted that while evaluating health insurance plans, 27% of respondents prioritised the hospital network, while 24% focused on simplified policy terms. 

Family influence remains strong for Gen Z, with 55% depending on relatives for guidance, while 61% of millennials prefer researching policies on aggregator platforms.

One of the key insights is that rising medical costs are pushing younger Indians to seek protection. Among 1,400 respondents, 37% said escalating healthcare expenses were the primary trigger for purchasing health insurance, while 36% were motivated by additional wellness benefits like health check-ups.

Yet, barriers remain. Lack of awareness prevents 44% of Gen Z respondents from buying health insurance, while 43% of millennials rely solely on their corporate health cover, perceiving it as sufficient protection.

“Gen Z and millennials constitute over half of India’s population, making them critical to the insurance industry’s future,” said Anuj Tyagi, Managing Director and CEO, HDFC ERGO General Insurance. “This segment is reshaping how insurers operate, demanding transparency, quick digital services, and hyper-personalised solutions.”

Despite their digital fluency, a significant number of young consumers continue to favour traditional channels for buying insurance. Around 60% of millennials and Gen Z have purchased policies offline, citing trust in agents for guidance during claims processes. Interestingly, 67% of Gen Z respondents reported needing assistance despite their comfort with technology.

Urban consumers are also seeking more comprehensive coverage. In cities like Kolkata, Bengaluru, Mumbai, and Chennai, nearly half of respondents expect pre-hospitalisation expenses to be standard in health policies. Rising medical costs are a key concern across these urban centres, with 42-49% citing them as a primary reason for considering health insurance.

Flexibility in premium payments is another emerging trend, with 30% of Hyderabad consumers and 29% in Mumbai seeking staggered payment options to ease affordability.

As India’s youth continues to shape the insurance landscape, insurers like HDFC ERGO are under pressure to blend digital convenience with personalised support, ensuring coverage remains relevant and accessible for the next generation.