Know your rights- What to do if health-insurance claim is rejected: What are the legal rights, what precautions are necessary while taking a policy

Every year, millions of people in India buy health insurance and many of them also file claims. But sadly, a large number of claims do not get approved. The main reason is that people are not fully aware of their rights, the rules, and the correct process.

Health insurance is not just a way to reduce the burden of hospital bills—it’s also your financial protection and legal right. If you already have health insurance, it’s very important to know:

• When you can file a claim,

• In which situations your claim may get rejected, and

• What steps you can take if you feel your claim has been unfairly denied.

In this article, we will talk about:

✅ What does health insurance usually cover?

✅ What are the rights of a policyholder?

✅ Common mistakes that may lead to claim rejection.

✅ Where and how you can complain if your claim is denied. ✅ What Does Health Insurance Cover?

While coverage depends on the type of plan you buy, most health insurance policies generally include:

• Hospitalization expenses – Room rent, doctor fees, nursing charges, ICU charges.

• Pre and post-hospitalization costs – Expenses incurred before admission and after discharge (usually 30–90 days).

• Daycare procedures – Treatments that do not require 24 hours of hospitalization (like cataract surgery, dialysis).

• Ambulance charges – In case you need to be rushed to the hospital.

• Cashless treatment at network hospitals – Direct settlement between hospital and insurer.

• AYUSH treatments (in many plans) – Ayurveda, Yoga, Unani, Siddha, and Homeopathy.

📌 Tip: Always check your policy wording carefully to know exactly what is included.

⚖️ What Are the Rights of the Insured?

As a policyholder, you are protected by IRDAI (Insurance Regulatory and Development Authority of India) rules. Some important rights include:

1. Right to clear information – Insurers must explain inclusions, exclusions, waiting periods, and claim procedures in simple language.

2. Right to cashless treatment – If you are admitted to a network hospital, you can avail cashless treatment subject to policy terms.

3. Right to grievance redressal – If your claim is wrongly denied, you can escalate it to the insurer’s grievance cell, IRDAI, or even the Insurance Ombudsman.

4. Right to free-look period – Within 15 days of buying a policy, you can cancel it if you are not satisfied.

5. Right to fair claim settlement – Insurers cannot reject claims without valid reasons as per policy wording.

   
   

❌ Common Mistakes That Lead to Claim Rejection

Many claims are rejected not because of fraud but because of small mistakes or lack of awareness. Avoid these:

1. Not disclosing pre-existing diseases – If you hide conditions like diabetes, BP, thyroid, or surgeries, the insurer may reject claims.

2. Ignoring waiting periods – Most policies have waiting periods (1–4 years) for pre-existing diseases and certain treatments.

3. Not renewing policy on time – If your policy lapses, you lose coverage.

4. Taking treatment in a non-network hospital without informing the insurer.

5. Submitting incomplete documents – Missing bills, reports, or prescriptions delay or reject claims.

6. Claiming for exclusions – Expenses like cosmetic surgery, dental (non-accidental), infertility treatments are usually excluded.

   
   

📝 What to Do If Your Claim Is Denied?

If you believe your claim was unfairly rejected, here are the steps you can take:

1. Ask for a written explanation – Insurers must give the reason for rejection in writing.

2. File a complaint with the insurer’s grievance redressal cell – Every insurer has one.

3. Approach IRDAI (IGMS portal) – You can escalate the complaint through the IRDAI Grievance Management System.

4. Go to the Insurance Ombudsman – If the issue is not resolved within 30 days, you can approach the Ombudsman for free and quick resolution.

5. Legal action (last resort) – If all else fails, you can take the insurer to court.

   
   

💡 How to Ensure a Smooth Claim Process

• Always disclose your health history honestly.

• Renew your policy on time without breaks.

• Keep medical records and bills properly.

• Check network hospitals before admission.

• Read your policy document and ask questions at the time of purchase.

📌 Example Case

Mr. Sharma bought health insurance but did not mention his diabetes at the time of purchase. Later, when he was hospitalized for kidney issues (linked to diabetes), his claim was denied due to non-disclosure.

👉 Lesson: Always declare pre-existing conditions. The premium may be slightly higher, but your claim will not be at risk.

🤔 FAQs on Health Insurance Claims

Q. Can an insurance company reject a genuine claim?

Only if it falls under exclusions, non-disclosure, or policy lapse. Otherwise, rejection is against IRDAI rules.

Q. What if the hospital refuses cashless treatment?

You can pay first, collect all bills, and file for reimbursement later.

Q. Is mental health covered under health insurance?

Yes, as per IRDAI guidelines, mental health treatment is also covered in most policies.

Q. How long does claim settlement take?

Cashless claims are usually processed within 2–6 hours; reimbursement claims may take 15–30 days.