Health Insurance Strategy for People Living in Two Indian Cities

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Many people in India reside across two cities for their jobs, education, and more. For them, managing health insurance becomes very complex due to the variations in healthcare infrastructure and provider networks. These differences can affect the access, costs, and claim processes.


So, it becomes important to understand how health insurance can work for people living in two Indian cities.


Understand How Location Affects Premiums and Coverage


Indian health insurers often use zonal pricing based on the city of residence. At times, they often use the proposer’s address. Cities are broadly classified into:


Zone 1: The cities covered in this zone are those with the highest premiums. Major metros like Mumbai and Delhi are treated as Zone 1. However, the categorisation differs from insurer to insurer.


Zone 2: Other big cities are covered in this category.


Zone 3: Zone 3 is the city with the lowest premiums. The smaller, tier 2 & 3 cities fall in this zone.


Premiums can be 15 to 50% higher in expensive zones due to higher hospital costs. Moving from Tier-1 to Tier 2 & 3 cities can lower premiums, while the reverse increases them.


Key Recommendations



  • It is highly recommended to choose pan-India coverage or flexible zone plans. You must opt for policies with nationwide coverage without zonal restrictions. This ensures seamless cashless or reimbursement claims in both cities without penalties.

  • Avoid strictly zone-restricted plans. They may be cheaper, but they may impose a 10 to 25% co-pay if you get treated in a higher cost zone.

  • Many modern plans offer pan-India options with no room rent capping, along with unlimited restoration of the sum insured. Choosing such plans can be highly beneficial if you travel frequently between cities or require multiple hospitalisations within a year.


IRDAI has introduced a “Cashless Everywhere” initiative. You can now get cashless treatment at any hospital in India. This is a game-changer for people moving between cities. You no longer need to worry about finding a specific network hospital in an emergency.


However, the zonal restrictions still apply. Thus, it is recommended to check the policy documents for such specifics before buying a plan.