Daybreak - Pune-based Loop Health’s big bet — insurance that keeps you out of hospitals

Episode Date: June 24, 2025

Turns out, in India’s healthcare industry, prevention isn’t just better than cure—it’s also far more investable.The new buzzword making the rounds? Health assurance. Not insurance—assurance.It means what it sounds like. Unlike traditional insurance, which kicks in after you fall sick, health assurance is about keeping you healthy to begin with.A Pune-based startup called Loop Health was the first to introduce India to a variant of the same concept. It positions itself as a corporate broker, not an insurer. So it doesn’t underwrite risk, but instead sells third-party insurance products to HR heads and bundles its own health perks alongside. The assurance model has helped this seven-year-old startup grow rapidly. Loop is dreaming big. It’s done being the middleman. Now, it wants to go full stack. But between regulatory hurdles and skepticism from the insurance and broking circles, its success isn’t assured. Tune in. Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too? It's for a special announcement. For the last few months, I and Sita Ramon Ganeshan, my colleague and the Ken's deputy editor have been working on an ambitious new podcast. It's called Intermission.

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Intermission launches on March 23rd. To get alert, as soon as we release our first video. episode, please follow intermission on Spotify and Apple Podcast or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. Turns out in India's healthcare industry, prevention isn't just better than cure. It's also far more investable. The new buzzword that's making the rounds is health assurance, not insurance, assurance. And it means exactly what it sounds like.

Unlike traditional insurance, which kicks in after you fall sick, health assurance is about keeping you healthy to begin with. So it's proactive, not reactive. That means regular checkups, early screenings, timely intervention, or helping you manage chronic conditions like diabetes and hypertension before they land you in a hospital. That way everyone wins. You keep people from falling sick so they don't need.

need expensive treatments, which means the insurer pays out less, the employer is happy, and employees don't have to deal with tasteless hospital food. Now, a Pune-based startup called Loop was the first to introduce India to a variant of that same concept. It positions itself as a corporate broker, not an insurer. So it doesn't underwrite risk, but instead sells third-party insurance products to HR heads and bundles its own health perks alongside. Think I checkups at Dr. Agar or discounts on cult fit memberships. So far, it has managed to tie up with insurers like Niva Bupa, ICICI Lombard and Star Health.

It's also put together a pretty impressive list of clients. It serves the likes of OLA, First Cry and Social, among many others. Now, the Assurance model has helped the seven-year-old startup grow rapidly. It was last valued at $150 million in 2022 and has raised $40 million from investors like elevation capital. Off late, investors can't seem to get enough of health assurance. Just last month, they wrote one of the largest seed round checks to PB Health. Now, this is a Guru Graham-based healthcare platform backed by InsureTech PB FinTech,

which is also aiming to take a preventive care approach. Interestingly, PB Health and Loop shared an investor, a VC firm called General Catalyst. Its chief executive, Hemantaneja, is practically evangelical about health assurance. he even spun out a separate unit that oversees investments in the space. Given the excitement, Loop is dreaming big. It's done being the middleman. Now it wants to go full stack.

But between regulatory hurdles and skepticism from the insurance and broken circles, its success isn't assured. Welcome to Daybreak, a business podcast from The Ken. I'm your host Rahil Filippos and I Don't Chase the News Cycle. Instead, every day of the week, my colleagues, Niklaus. Sharma and I will bring you one business story that is worth understanding and worth your time. Today is Wednesday, the 25th of June. The biggest catch in all of this is that technically a broker isn't even allowed to bundle health services with insurance policies.

The insurance regulator and development authority of India prohibits it. But Loop has found a workaround. Its insurance broking happens through one entity, while the wellness services are delivered through a separate health unit. But of course not everyone is happy with this dicey loophole model and the heavy discounts that it offers. In fact, it's allegedly prompted the likes of Niva Bupa and ICICI-Lomba to be quite very of loop. But its clients are happy because they end up saving up to 10% in the premiums they pay to insurers when they go through Loop. Their employees are also happy because their claims are processed much faster. Mayang Kale, the CEO and co-founder of Loop,

to the kin how typically it takes about 60 days for insurers to process a claim because of manual broker work. But now, thanks to digitizing the process and enabling direct access to support, Loof has cut it down to about 20 days. The question then is, who actually is footing the bill for these discounts and freebies? Well, one expert we spoke to said typically insure techs pay out of pocket. In the process, they end up amping up competition in the space, because because suddenly start-ups will come forward with discounts and free services, all to attract the same client pool. For instance, Bangal-based health tech on Sority

offers its clients' free webinars on fitness, wellness and yoga, besides providing discounts on medicines and health checkups. Six-year-old Plum Insurance 2 includes coverage for mental health services, health checkups and discounted medicines in its offerings. The same expert said some insured techs end up paying up to 4,500 hundred rupees per employee they cover for these free services. So naturally, these startups end up burning a lot of cash. Case in point, Kenko Health.

The Bangal-B startup ran a similar model until August 2024 when it shut down. It just could not sustain the discounted prices. So Loop is trying to avoid that fate. Kali explained how if a client pays $1,500 for a diagnostic test, they use the profitable margin to give them a consulting. too. He claims with that approach, they've managed to grow more than 100% a year. As of March 2024, the company posted a loss of 30 crore rupees on revenue of nearly 9 croix. The CEO refused to divulge more on the company's financials, but stated that its gross margins are over 50%.

The biggest challenge it is facing now is India's attitude towards health assurance, because that is still a work in progress. Stay tuned. Despite all the investor enthusiasm, not everyone in the insurance sector is buying the hype. VCs love to call insure techs like Loop 360-degree health tech companies. You get insurance, you get wellness, data plus engagement. One neat bundle that's great for the pitch tech. But in practice, there's no tracking, there's no incentives, there's no link between benefits and insurance. For users, it's just a broker that throws in a free eye test.

Globally, the idea is to offer people discounts on premiums if only they use the wellness benefits for a particular period, which isn't quite the case in India. No one here tracks if you're actually getting your eye-checked or enrolling yourself in a yoga class. And then there's the regulatory concern. You see, corporate brokers in India aren't allowed to offer in-house health and wellness benefits by themselves. Only insurers are. Star Health, for instance, offers full-body checkups as part of some plans. Niva Bupa includes maternity and prenatal consultations with some of its own. So what did Loup do?

Well, back in 2022, it carved off its insurance broking arm into a separate entity. The idea was that the broking and the perks could appear separate. Kali insists that there's no real issue with this approach. He also denied allegations of any complaints or being blocked listed by any insurers. You see, for Loup to be an all-round health assurance firm, it wants to dip its feet into selling policies of its own as well. So, it went ahead and applied for a license to offer insurance products with a regulator in July 2024.

But alas, a recent acquisition attempt may have thrown a spanner on the works. Loops failed acquisition of Palm insurance brokers led to the latter accusing Loop of bad faith after alleged staff poaching. Palm registered a complaint with a regulator just before Loop handed in his license application. And a person close to the company said this dispute could have likely delayed the approval process at the regulator's end. Now, Loop is focused on next steps. If its application is approved,

the company will need additional capital to underwrite policies and to build tech. Kali isn't bothered about the first use case, though. Unlike Kenko, which paid out claims from its own pockets and burnt money, we don't do that, he said. Loop plans to depend on premiums it expects to collect from customers. Any funding it raises would only be used for growth and tech-upes. upgrades. It'll have to deal with the immense scrutiny from the regulator if it does go down

that route because it requires licensed insurers to report the percentage of net premiums they use to pay out claims. That's known as the incurred claims ratio or ICR. It restricts the use of external funds here. If approved, Loop will have to play by these same rules. But it may have an edge. By already running the wellness layer, it knows what benefits people actually use and what keeps claims low. That's data that insurers like Starr, Niva, Bupa and ICICI-Lombard don't have. That's what could give Loop a head start in designing smarter products.

But first, it has to convince its clients that it's more than just a middleman. Daybreak is produced from the Newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. Today's episode was posted by Rahil Filippos and edited by Rajiv Sien.