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BW Businessworld

Five Reasons Why Your Health Insurance Claims May Get Rejected

Below we discuss the possible reasons that a claim is rejected so that one can avoid it:

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The entire nation is grappling with the second wave of COVID-19, and lockdowns have been imposed again. The second wave has made us realise that the future is uncertain, and one can have a medical emergency at any point in one’s life.  We have seen COVID hospitalisation expenses rising up to lakhs of rupees.  Therefore, it is important to be equipped in advance by insuring oneself and opting for a health insurance policy that can save us from unforeseen ailments due to such deadly viruses.

However, while buying health insurance policies, policyholders must understand their health policies and claim parameters to ensure their claims do not get rejected. It would be troubling to face a health emergency and have your insurance claim rejected. Therefore, it is better to know your policy well, including conditions that might get the claim rejected.

Suppression of past or on-going illness: It is important to unveil all medical history and health details of the insured while purchasing a health policy, as it will not only help in curating the right policy for an individual but also help in the efficient processing of the claims. Hence hiding any disease at the time of buying the policy can later result in a rejection of claims, as the insurance contract is built in good faith. 

Specific Exclusions:  If your insurance policy categorically cites that it does not cover the claims of the pandemic, then COVID-19 treatment claims might be rejected. Also, there are cases when a few policies do not cover pre- or post-hospitalisation expenses related to COVID-19 and home care expenses as well. If a person raises a claim against such specific exclusions, there are chances of it getting rejected. In case of any doubt, please clarify with the health insurance company.

Terms and conditions of the Policy: There are certain conditions in the policy breaking which claims can get rejected. For instance, in case of COVID claims, as a policyholder, if you and your family members have a recent travel history to any country, which is badly affected by COVID-19, the insurance company might reject the claim. Furthermore, if a person gets COVID-19 without travelling anywhere, but someone from his family has travelled to the countries affected by COVID-19, the policy claim might get rejected.

Going beyond the sum insured: Sum insured is the maximum value for each year that your insurance company can pay in case of hospitalisation. If there is any amount above and beyond the sum insured, it has to be paid by the insured. Whether you opt for a family floater or an individual health cover, the sum insured is the amount available to you or your family annually. If a person has utilised the entire sum for a particular year, then subsequent claims will get rejected unless it gets refilled again on renewal, or if a Sum Insured Refill add-on is opted for. Hence, while buying a policy it is advisable to opt for a restoration or refill benefit add-on, so that even if Sum Insured is exhausted in a year, it can automatically get replenished and claims are not rejected.

Waiting period: Most health insurance companies come with an initial waiting period, usually ranging between 15 to 30 days, to activate the policy and waiting period for pre-existing diseases, usually ranging between 2 to 4 years, during which a person cannot make a claim. The length of the waiting period depends on the plan and type of claim. There are high chances of claims getting rejected if the insurer raises it prematurely for a condition on which a certain waiting period is applicable.

Insurance is an agreement signed in good faith. Hence, it is important for the policyholders to provide complete, factual, accurate and most recent information to the insurer. If one fails to disclose such a condition at the time of purchasing the insurance, one’s claims and insurance will be rejected later. Also it is advisable to read all terms and conditions well of the policy so that any such situations where claims might get rejected can be avoided. 

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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COVID-19 Lockdowns

Vivek Chaturvedi

The author is Head of Marketing, Digit Insurance

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