The most critical moment in the entire tenure of health insurance policy is when a claim is filed. One of the most common queries we get from people is for buying a policy and whether the insurance company will honour the claim.While the fact remains that if an insurance company wants a lower claims ratio, it has to concentrate more on policy sourcing rather than the claim payment, it is the duty of the policyholder to follow all policies and procedures given in the insurance document and not give the insurer a chance to reject his claim.

 

If customers take some precautions and follow rules to keep their part of the contract, even if the insurer falters, there are regulations to protect their rights.
Here, we list some broad reasons why your health insurance claims may be rejected and ways to steer clear of them:
1.     Read Policy Contract
Often it is seen that the customers are not aware of exclusions under the policy as many do not take the trouble of going through the policy terms and conditions at the time of sale. This is a serious mistake as you wouldn’t even be aware when you breach a condition mentioned in the policy document. For instance, you bought a health insurance policy and saw that it covered pre-existing diseases. Also Read: Common Exclusion Clauses in Health Insurance!
However, you missed the asterisks which clearly mentioned “after four years of consecutive insurance with the company”. So, read policy contract terms & conditions carefully and understand them well. When in doubt, seek clarifications from the advisor or the insurer.
2.     Non-Disclosure of  Facts
Common reasons claims are repudiated are non-disclosures, partial disclosures and wrong disclosures of significant facts such as age, nature of occupation, income, existing insurance policies, major ailments or pre-existing medical conditions due to customers often refrain from filling their forms and depend on third parties and intermediaries. This can lead to serious mistakes in declarations. The agent is often not aware of exact customer details and the policy is underwritten with these incorrect details.
The only way to tackle this is to fill up the proposal form yourself. Submit genuine documents at the time of buying a policy in an orderly and timely manner to the insurance company with details. While applying for the product, customers should be aware of the consequences of concealing or giving incorrect information.
3.     Inflated Claims
Health insurers many times reject a claim saying a service or procedure was “not medically necessary”. “Private hospitals, in their quest to generate maximum revenue, perform medical procedures which may not be necessary, on patients covered by a medical insurance policy. The policyholder is also relaxed about it as he mistakenly assumes the money will be paid by the insurance company. The penny drops when the claim is rejected.
Always remember, coverage is offered based on the information provided by the proposer on the proposal form and hence any gap between what is declared and the reality at the time of filing claims can be a reason for rejection. Every insurance company offers a free-look period of 15 days to cancel or alter the contract if you find the contract to be different from what you had understood it to be. Avail of this facility if you require. Also Read the fine print before taking an all inclusive Health Insurance! 
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Suresh Kumar Narula

SEBI Investment Advisor, Founder & Principal Financial Planner at Prudent Financial Planners
Suresh K Narula is founder and Principal Financial Planner at Prudent Financial Planners. He has earned the professional CERITIFIED FINANCIAL PLANNER and got registered with SEBI as Investment Advisor. He writes on personal and financial planning articles and got published in Dainik Bhaskar, Business Bhaskar and The Financial Planner's Guild, India. He is also a member of Financial Planner's Guild India ( An association of practicing SEBI registered Investment advisers) to create awareness about Financial Planning in general public, promote professional excellence and ensure high quality practice standards. Suresh received his an M.com from Himachal Pardesh University and an MFC from Punjab University, Chandigarh. He can be reached at info@prudentfp.in
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