BACKGROUND: Various features in health insurance schemes may lead to variation in health care. Unwarranted variations raise concerns about suboptimal quality of care, differing treatments for similar needs, or unnecessary financial burdens on patients and health systems. This realist review aims to explore insurance features that may contribute to health care variation in Asian countries; and to understand influencing mechanisms and contexts. METHODS: We undertook a realist review. First, we developed an initial theory. Second, we conducted a systematic review of peer-reviewed literature in Scopus, MEDLINE, EMBASE, and Web of Science to produce a middle range theory for Asian countries. The Mixed Methods Appraisal Tool (MMAT) was used to appraise the methodological quality of included studies. Finally, we tested the theory in Thailand by interviewing nine experts, and further refined the theory. RESULTS: Our systematic search identified 14 empirical studies. We produced a middle range theory in a context-mechanism-outcome configuration (CMOc) which presented seven insurance features: benefit package, cost-sharing policies, beneficiaries, contracted providers, provider payment methods, budget size, and administration and management, that influenced variation through 20 interlinked demand- and supply-side mechanisms. The refined theory for Thailand added eight mechanisms and discarded six mechanisms irrelevant to the local context. CONCLUSION: Our middle range and refined theories provide information about health insurance features associated with health care variation. We encourage policymakers and researchers to test the CMOc in their specific contexts. Appropriately validated, it can help design interventions in health insurance schemes to prevent or mitigate the detrimental effects of unwarranted health care variation.