Six reasons that may lead to claim rejections

A health policy is a must-have tool for your financial safety during illness and hospitalisation. However, an unexpected rejection of your insurance claims could cost you a lot of money. To avoid such a situation, it is important to be well-versed with all the terms and conditions of your policy. Here are some common mistakes that people make which could lead to the rejection of their health insurance claims.

Exclusions & Waiting Periods
Every health insurance plan comes with exclusions. If you claim against a treatment or procedure not covered by your plan, your claim may get rejected. Infertility treatment, drug and alcohol abuse, and radioactive contamination are some of the common conditions which have been excluded from most health plans. Certain treatments are covered after graded waiting period. For example, most policies would entertain no claims in the first 30 days, while some policies may cover maternity charges after 48 months, and so on, depending on the policy’s terms and conditions. Pre-existing diseases are typically covered after a waiting period. When you buy a health policy, you must comb through the list of exclusions to avoid unpleasant surprises.

Delayed Claim
Every health insurance policy has a specified time frame within which you must intimate the insurer about the possibility of a claim being made. Both in case of a planned hospitalisation or an emergency one, the insurance company has to be informed as per the procedure and time frame mentioned in the policy document. Not following these rules could lead to a rejection of your claim.

Incorrect Information
While buying a policy, the applicant may conceal facts, or provide incomplete information, to the insurance company about his or his family’s health history. Such facts are critical to the underwriting of the insurance. If these facts come to light at a later stage during a claim process, there could be a rejection. The law mandates that the proposal form filled during the policy buying should provide correct information. Make sure that you disclose all health related information at the time of buying the policy to avoid last minute hassles. You need to control this process and not be pressured into acting with haste by anyone selling the insurance policy.

Paperwork Problems
When applying for a claim, you must submit all necessary documents pertaining to the treatment. You must file these in the manner required by the insurer. Typically, you would have to submit the diagnosis, medical bills, discharge summary, test reports among others in original. The dates on these documents must conform to the timeline of the treatment. A claim would be stopped till such time as all documents have been provided.

Not Completing Authorisation
While you avail a cashless treatment through your insurance plan, you will need to seek authorisation of the insurer. This is done by completing the paperwork in coordination with the consulting doctor and the insurer. Once the authorisation was granted, only then can the treatment proceed cashlessly. Also, the authorized treatment needs to be completed within a time frame prescribed by the insurer.  

Lapsed Insurance
Your policy would lapse if your premiums are not paid. Claims raised after the policy expiry would not be entertained. You must take note of your premium due dates and ensure the payments happen in a timely fashion for policy renewal.  You also need to remember that you would be denied no-claim bonuses, if any, and your waiting periods would start afresh, if your policy has lapsed.

If your claim was rejected, your insurance company will give you an explanation for denying you the benefits but it can be confusing and can catch you off guard. With a bit of a homework you know where you stand and you can prepare yourself accordingly. A quick but careful read through the terms and conditions can help you stay informed.

(The writer is CEO of BankBazaar.com)