Health Insurance Claim: This is why your insurer may not settle the entire claim amount

With the current pandemic situation, the importance of having a health insurance plan has doubled. Health insurance plan is not a choice but the need of the hour. While buying a health insurance policy, it is important to know and understand all the specified conditions in the policy documents. Leave no point unread as it may cause glitches during the claim settlement process. There are many instances where the claim gets declined at the last minute, and despite having a health insurance policy, the person must pay for medical treatments from his/her own pocket. To avoid such terrible experiences, it is vital to know what are the chances or cases of a claim getting denied by the insurance company. Try to make yourself well-aware of the insurance terminology. Otherwise, it will be difficult to understand the clauses mentioned in the policy documents. If still, you face issue in understanding any point, then mention it to your insurance advisor and get it cleared.

Here are some reasons due to which your health insurer may not paythe entire claim amount.

1. Co-pay – The option of co-paying means that the total expenses of the treatment are borne by both insurer and customer. This option is provided to improve the way the customers consume health facilities as they limit the unnecessary health services and check the bill properly, which people usually skip when it is paid directly by the insurance company.

2. Restrictions on room rent – One of the most common mistakes made by customers is not paying enough attention to the restrictions on specification about room rent mentioned in the policy. You may have to pay a large chunk from your own pocket depending on the type of hospital you choose and the sum insured. Usually, insurers limit the room rent to 1% or 2% of the sum insured. Which means if your health insurance policy’s sum insured amount is 4 lakhs, then the room amount covered is ₹3000 and any amount exceeding it shall be paid by you. But this limit does not apply to ICU as per the IRDAI regulations.

3. Geographical restrictions – Some health insurance policy providers set the price of the policies depending on the geographical area as health services in metro cities are expensive than ones available in smaller cities and towns. Generally, when a person buys a policy in a small town and must take treatment in a metro city hospital, the bill is split between insurer and customer. Usually, people from small towns move to hospitals in major cities for the treatment of severe illness. Thus, the burden of co-pay is high.

4. Public sub-limits – There is a possibility that the policy you choose has sub-limits on particular benefits much lower than your sum insured. Read your policy documents to check if there are any sub-limits on specific benefits. In a few cases, there is a 10 per cent cap of inpatient claim on pre and post hospitalization expenses.

5. Procedure limit – Some policies have limits on common surgical treatments such as cataract, hernia, etc. much lower than the policy limit. In such cases, if the treatment costs are more than the procedure limit, then the customer must bear the difference in expenses.

6. Limitations on expenses– There are a few policies, especially retail plans that put a limit on the professional charges, room rent, and other medical expenses.

Expenses of consumables – Generally, in an average hospital bill the charges for consumables like gloves, dressing, cotton, etc. is 3% to 6%. But during the current scene of COVID-19, these charges have escalated to 15% to 20% with the need of PPE kits, masks, shields, etc. If your health insurance policy does not cover these costs, then you will have to pay them from your pocket.

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