I have an impression that the health insurance sector is not regulated in India. If you have a policy and take a claim then next time the insurance companies denies the extension of the policy or minimum they do is to charge very hefty premium. In that case what is the fun in taking medical insurance?

IRDA is doing a wonderful job in regulating insurance industry of this country. You might have had bad experience with a company. Generally it does not happen. But if you lodge claims in 2 successive years- then you will face difficulty.