Non-disclosure of existing health conditions is the main reason for insurers to reject claims.
Around 25% of health insurance claims are rejected because the insured had pre-existing conditions like diabetes or hypertension, which were not disclosed at the time of purchase. Another 25% of claims rejections are because policyholders were unaware of the terms of cover and claimed for OPD (outpatient department) or other treatment excluded under the policy. A large chunk of claims (16%) are rejected because the claimant did not revert to queries.
PolicyBazaar, which has an insurance broking licence, analysed the data on two lakh health insurance claims between April to September 2023, of which 30,000 were rejected.
From the insured’s perspective, the worst damage to their financials is caused by claims rejected for non-disclosure. While an equal number of claims are turned down for being outside the scope of the policy, these are low-value claims, with the occasional claim being turned down for experimental procedures.
“While rejections due to the treatment being outside the scope of the policy are numerous, they are usually for low-value expenses. The insured file many claims out of ignorance. We have seen OPD claims and claims for spectacles, which are, of course, not covered,” said Amit Chhabra, chief business officer – health insurance, PolicyBazaar.
