Mediclaim (health insurance) policies are crucial for financial protection during medical emergencies, yet policyholders often face claim rejections due to various policy terms and conditions. Lets have a detailed look at the most common reasons for mediclaim rejection.
Exclusions are specific conditions, treatments, or situations that the insurance policy does not cover. These are clearly listed in the policy document and can vary between insurers and policy types. Common exclusions include certain illnesses during the initial years of the policy, cosmetic treatments, psychiatric disorders, injuries from hazardous sports, and more.
Clause 4.3 is a standard exclusion in many Indian mediclaim policies. It typically excludes coverage for specific diseases or procedures (like cataract, hernia, benign prostatic hypertrophy, etc.) for a defined period, often the first one or two years of the policy. For example, if a policyholder undergoes cataract surgery within the first year of coverage, the claim may be rejected under clause 4.3, unless the policy has been continuously renewed for the required period.
Courts have increasingly scrutinised exclusion clauses, especially when they seem unfair or inadequately disclosed. The principle is that exclusions must be clear, reasonable, and not defeat the main purpose of the insurance contract. In cases of ambiguity, courts often interpret the clause in favour of the insured.
Most policies impose a 30-day waiting period from the policy start date, during which no claims (except for accidents) are admissible. This prevents people from buying insurance solely after falling ill.
Certain illnesses and procedures (like hernia, piles, cataract) are excluded from coverage for a longer period, often one or two years, as specified in clause 4.3. Claims for these ailments within the waiting period will be rejected.
Pre-existing diseases are typically excluded for a period ranging from two to four years. Only after continuous renewal for the stipulated period will such conditions be covered.
Historically, only treatments requiring hospitalisation for at least 24 hours were covered. However, many advanced medical procedures now require less than a day’s stay (e.g., chemotherapy, dialysis). If your policy does not explicitly cover day care procedures, claims for such treatments can be rejected, even if the medical expense is significant.
Treatments conducted on an outpatient basis (OPD) are typically not covered unless the policy specifically allows it. Claims for procedures that could be done without hospitalisation are often denied under relevant exclusion clauses.
A pre-existing disease is any illness or condition that existed before purchasing the policy. Insurers require full disclosure of such conditions during application. Claims for treatment of pre-existing diseases made before the end of the waiting period are routinely rejected.
If a policyholder fails to disclose a pre-existing condition, the insurer may reject related claims even after the waiting period, and in some cases, may void the policy entirely. Courts have generally upheld the insurer’s right to reject claims in cases of material non-disclosure.
Most standard mediclaim policies cover only allopathic (modern) medicine. Treatments under Ayurveda, Homeopathy, Unani, or other traditional systems are excluded unless the policy specifically mentions their inclusion. Similarly, experimental or unproven treatments, which lack established efficacy, are not covered
Insurers exclude these treatments due to the lack of standardized protocols, variable costs, and uncertain outcomes. Claims for such treatments are routinely denied unless the policy has a specific provision for alternative medicine.
Cosmetic or aesthetic procedures, such as plastic surgery for beautification, are not covered by health insurance. The rationale is that these are elective and not medically necessary. Exceptions are made only if the procedure is required due to an accident or to correct a congenital anomaly with medical implications
Claims can be rejected if the claim form contains errors, omissions, or inconsistencies—such as wrong policy numbers, incorrect personal details, or missing documentation. Insurers require accurate and complete information to process claims efficiently. Even minor discrepancies can delay or derail the claim process.
If the policyholder fails to pay the renewal premium on time, the policy lapses, and coverage ceases. Any claims made during this period will be rejected, regardless of the medical necessity. It is crucial to renew the policy before the expiry date to maintain uninterrupted coverage
Most policies require the insurer to be informed within a stipulated period (often 24-48 hours for hospitalization). Delayed intimation can result in rejection.
Claims for treatment at non-empanelled or blacklisted hospitals may not be entertained.
Any attempt to misrepresent facts or submit fraudulent claims will result in outright rejection.
Mediclaim rejections often stem from policy exclusions, waiting periods, non-disclosure of pre-existing diseases, and administrative lapses. To reduce the risk of claim denial, policyholders must thoroughly understand their policy’s terms, disclose all relevant health information, and ensure timely renewals and accurate documentation. When in doubt, seek clarification from your insurer to ensure your coverage meets your needs and expectations.
