India’s worsening air pollution crisis has long been a public health emergency, but the proposal by insurers to hike health premiums in New Delhi due to pollution-related illnesses threatens to turn it into an economic crisis as well. If approved, this move will penalise those already suffering from toxic air while setting a dangerous precedent for the future of health insurance in the country. Insurers argue that a surge in pollution-related claims, particularly for respiratory and cardiovascular illnesses, necessitates a 10 per cent-15 per cent increase in premiums.

Their reasoning follows standard risk assessment logic ~ higher hospitalisation rates should lead to higher insurance costs. While sound, this rationale ignores a fundamental ethical issue: air pollution is not a personal choice but a systemic failure. Unlike habits such as smoking or an unhealthy lifestyle, which can influence insurance rates, pollution is an unavoidable external factor. Citizens have no control over the air they breathe, and penalising them financially for it shifts the burden away from policymakers and industries responsible for pollution on to individuals who are merely trying to survive in an increasingly toxic environment. The proposal borders on being a criminal insult being added to a state-inflicted injury.

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Add to this the unseemly dithering over a reduction in GST rates on health insurance premiums and the picture of insensitivity is complete. A rise in premiums may seem like a small adjustment from an industry perspective, but for many, it could mean losing access to health insurance altogether. In a country where healthcare costs already strain household budgets, making insurance more expensive will only widen the gap between those who can afford quality healthcare and those who cannot. Delhi’s per capita income, while higher than the national average, still does not guarantee that families can absorb such cost increases. A 10-15 per cent hike could make insurance unaffordable for some groups, forcing them to rely on out-of-pocket expenses, which often leads to financial distress in medical emergencies. If this model is approved, insurers could extend it to other polluted cities like Mumbai and Kolkata, creating a fragmented insurance landscape where residents of heavily polluted areas pay more for the same coverage.

The logic could then extend further ~ should people in flood-prone areas pay more for health insurance due to waterborne diseases? Should those in drought-hit regions bear a higher cost for dehydration related conditions? If systemic environmental issues become pricing factors, the very purpose of health insurance ~ to offer financial security against unforeseen health crises ~ would be undermined. Instead of passing costs to policyholders, insurers must explore alternative solutions.

Encouraging preventive healthcare, subsidising air purifiers for vulnerable groups, or working with the government to tackle pollution at its source are more sustainable responses. The insurance regulatory body must also demand long-term data before allowing pollution to influence premium pricing. This proposal is not just about insurance; it is about responsibility. If pollution is making people sick, the solution is not to make them pay more ~ it is to make the air cleaner.