Tata AIG Joins Star Health, Niva Bupa In Ending Cashless Claim Settlement At Max Hospitals

Tata AIG General Insurance has become the third major insurer, after Star Health and Niva Bupa, to suspend its cashless settlement arrangement with Max Hospitals, Moneycontrol reported.

The decision, effective 10 September, forces policyholders to pay upfront for medical treatment, highlighting the widening rift between insurance companies and hospital chains over tariffs and settlement terms.

Dispute Over Tariffs

Max Healthcare said that the two parties had signed a two-year tariff agreement from 16 January 2025 to 15 January 2027.

However, in July, Tata AIG sought further rate cuts, warning that cashless services would be suspended if its demands were not met.

“When we did not accept it, cashless services at our hospitals were suspended effective September 10, 2025,” a Max Healthcare spokesperson was quoted as saying by Moneycontrol.

The hospital chain added that further rate reductions would be “unviable” and could compromise patient care.

To help patients, Max has set up an express desk to support reimbursement claims.

Tata AIG’s Stand

In response, Tata AIG said that it has put in place special arrangements to ensure its customers didn't face any inconvenience.

“TATA AIG has put in place special arrangements to ensure that our customers face absolutely no inconvenience. All claims are being prioritised and fast-tracked, allowing policyholders to continue receiving uninterrupted and seamless access to treatment and care. Our dedicated service teams are monitoring every case closely to provide complete support and ensure zero disruption for our customers," a Tata AIG spokesperson was quoted as saying by Moneycontrol.

Wider Industry Flashpoint

The impasse follows earlier clashes between insurers and hospitals.

In August, Star Health suspended cashless services at several hospitals including Manipal, Medanta, Max, Care, Rajiv Gandhi Cancer Hospital, and Sarvodaya.

The Association of Healthcare Providers of India (AHPI) criticised the move as “arbitrary.”

After negotiations, Star Health and AHPI member hospitals agreed to restore cashless services from 10 October.

Similarly, a stand-off between AHPI hospitals in north India and Bajaj Allianz over cashless withdrawals was resolved earlier this month.

Please click here to add Swarajya as your preferred and trusted news source on Google