Health insurance claim rejection: legal remedies
Insurance policies give customers a sense of security, especially when there is a sudden spike in their medical needs. Therefore, it is completely valid to be stressed after receiving a claim rejection. This is the unfortunate reality for millions of policyholders in India. The good news is that a claim rejection is not the finishing line for you. There are legal options available to you if the rejection is unreasonable or goes against the terms of the policy. The good news is that taking action legally is not that complicated. It just takes some knowledge.
Most common reasons for health
insurance claim rejections
The list is long when it comes to the reasons
for claims being rejected, but the most common reasons include:
●
Non-disclosure or unfair
disclosure of a medical condition or disease
●
The treatment in question is not
covered under the policy
●
The policy is lapsed due to
non-payment of a premium
●
There is a delay in the
notification of the claim
●
There is a misrepresentation of
the documents
●
The waiting period for the
insurance claim has expired
While the above reasons may be valid in a
given case, there are many rejection cases that are rejected due to vague
clauses or technicalities that are legally challengeable.
Review Policy Terms Thoroughly
Before taking any legal actions, go through
your policy document once more. Focus on specifics like:
●
What is and is not covered
(Exclusions)
●
Waiting Periods
●
Steps necessary to submit a Claim
●
Time restrictions
Once you’ve examined these aspects, compare
them with the reasons mentioned in the rejection letter given to you by the
insurer. If there is a lack of evidence to support a claim rejection through
policy documentation, you may have a strong case.
Here, legal
advice online in India comes in handy. A legal professional will
simplify policy jargon for you.
Lodge a Complaint with the
Insurance Company
The first legal option is to make a formal
complaint to the insurer. Most insurance companies have grievance redressal
cells. You may include:
●
Claim rejection letter
●
Medical Bills
●
Discharge Summary
●
A Copy of the Policy
●
Other Correspondence with the
Insurer
You can request a written response. Most
disputes get settled here as insurers discover the claim was erroneously
denied.
Contact the Insurance
Ombudsman
If the insurer does not respond to you or
refuses to review a claim, you can contact the Insurance Ombudsman. This
consumer-friendly and cost-free platform should be your next step.
You are allowed to file a complaint when:
●
The claim amount is below 30
Lakhs.
●
You have claimed the insurer
before.
●
30 days have elapsed.
The Ombudsman possesses the authority to
review the information and provide instructions about the insurance company to
the insurer.
Filing a Consumer Complaint
As per the Consumer Protection Act, health
insurance is treated as a “service.” If the insurer has provided insufficient
service or has acted unfairly, you can file a complaint against the insurer at
the:
●
District Consumer Commission
●
State Consumer Commission
●
National Consumer Commission
Depending upon the claim amount, the forum for
making a complaint changes.
A consumer complaint can demand the following:
●
Payment of the claim amount
●
Compensation for mental harassment
●
Litigation costs
Notable judicial decisions from the courts are
in favour of the policyholders in many cases where the insurance companies
denied the claims.
Civil Suit as a Legal Remedy
In complex or high-value disputes, a civil
suit for breach of contract can be undertaken. This is done when there are
suitable consumer forums or the issue is of complex legal interpretation.
This option is for those who have a clear
understanding of the legal aspects, as insurance disputes are primarily around
contract law, evidence, and medical records.
The Importance of Legal
Consultation for Claim Disputes
Disputes with health insurance companies are
complicated. The wording of policies is deliberately made confusing. Legal
intervention is needed for specific parts of medical records. And there are
strict deadlines.
Legal consultation online helps with:
●
Assessment of whether the
rejection was legal
●
Choosing the appropriate legal
forum
●
Legal notice preparation
●
Filing consumer complaints
●
Avoiding mistakes in procedure
The best
online lawyer consultation provides you with prompt assistance without
the need for an in-office consultation. This is most beneficial in situations
where quick measures need to be taken, or if you are located in a different
municipality than the insurer’s office.
Documents to prepare
If your claim is denied, you should retain the
following documents:
●
Policy Document
●
Claim Form
●
Hospital bills
●
Doctor’s prescriptions
●
Discharge summary
●
Rejection letter
●
Email or SMS communication
These documents are critical to any legal
course of action.
Understand When to Reject a
Claim
The courts have ruled in favour of the
claimants in the following situations:
●
Insurance companies cannot deny
claims without providing a detailed justification.
●
Insurance companies cannot use
terms of the contract purportedly buried in the contract.
●
Insurance companies cannot deny
claims without considering the medical evidence.
●
Insurance companies cannot deny
claims without conducting a proper and thorough investigation.
Legal remedies exist if your rejection fits
any of these criteria.
Conclusion
You have the option of taking action instead
of losing your finances as a result of a health insurance claim rejection.
Policyholders are legally protected from irrational behaviour. There is a range
of legal options from complaint cells to consumer courts.
Any legal counsel will help you assess your
options, decide the most appropriate channel, and file a defensive claim
rejection. Taking the right steps, combined with solid legal support,
determines whether you keep your claim.
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