If you are stuck in such a situation, here is what to do.

Mr. Alok’s father was recently admitted to a hospital in the city of Anandpur for about a week to undergo treatment for a severe kidney stone. Armed with his health insurance policy from ‘Suraksha Health Insurance’, Mr. Alok approached the hospital’s insurance desk for a cashless claim. To his dismay, the hospital informed him that the insurer had rejected the cashless request. Left with no immediate alternative, the family managed to arrange and pay the hospital bill of approximately ₹1.75 lakhs out of their own pocket to ensure his father received the necessary treatment.

Following his father’s discharge, Mr. Alok diligently compiled all the required bills and medical documents and filed a reimbursement claim with Suraksha Health Insurance. What followed was a frustrating ordeal. The insurance company took over a month to process the claim, repeatedly asking for various documents. Each time, Mr. Alok coordinated with the hospital and promptly submitted the requested paperwork. Despite his full cooperation, he received a final communication from the insurer stating that his reimbursement claim had also been rejected. This situation, where an insurer denies both cashless and reimbursement claims, is unfortunately not uncommon and leaves policyholders feeling helpless and financially strained.

Advice in such cases

Facing a claim rejection can be distressing. However, there is a structured path you can follow to challenge the insurer’s decision.

• Review the Rejection Letter: Carefully read the insurer’s rejection letter to understand the exact reason for the denial. The reason could range from the ailment not being covered, issues with documentation, or a pre-existing condition clause.
• Scrutinize Your Policy Document: Go through your health insurance policy document in detail. Pay close attention to the terms, conditions, inclusions, and exclusions. This will help you determine if the insurer’s reason for rejection is valid according to the policy you purchased.
• Maintain Written Communication: Ensure all your communication with the insurance company is in writing, preferably via email. This creates a documented trail of your interactions, which is crucial evidence if you need to escalate the matter.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

Your rights as a policyholder are protected under Indian law. The primary legal frameworks applicable here are:

• Insurance Regulatory and Development Authority of India (IRDAI) (Protection of Policyholders’ Interests) Regulations, 2017: These regulations set strict timelines and procedures for insurance companies to follow while processing claims. Any deviation can be grounds for a complaint. IRDAI mandates that insurers must settle or reject a claim within 30 days of receiving the last necessary document.
• The Consumer Protection Act, 2019: A rejection of a legitimate claim without a valid reason is considered a “deficiency in service” under this Act. You can file a complaint against the insurance company in the appropriate Consumer Disputes Redressal Commission (District, State, or National, depending on the claim value).
• The Insurance Ombudsman: This is an independent body that provides a platform for an impartial resolution of disputes between policyholders and insurance companies. You can approach the Ombudsman after your complaint has been rejected or not satisfactorily resolved by the insurer’s internal grievance redressal mechanism.

If you are the complainant

As the person fighting the case on behalf of the patient, you should take the following systematic steps:

• Organize all Documents: Collate the policy document, all hospital bills, medical records, discharge summary, the claim form, the rejection letter, and all email correspondence with the insurer.
• File a Grievance with the Insurer: The first formal step is to file a written complaint with the Grievance Redressal Officer (GRO) of the insurance company. You can find the GRO’s contact details on the insurer’s website or your policy document.
• Escalate to IRDAI: If the insurer does not respond within 15 days or the response is unsatisfactory, you can escalate the complaint to IRDAI’s Integrated Grievance Management System (IGMS).
• Approach the Insurance Ombudsman: If the issue remains unresolved, file a complaint with the Insurance Ombudsman in your jurisdiction. This is a cost-free and effective mechanism.
• File a Consumer Complaint: Concurrently or subsequently, you can file a case for deficiency of service in the appropriate consumer forum.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

If you are the victim

As the policyholder or patient, your focus should be on protecting your rights and seeking the rightful claim amount.

• Understand Your Rights: You have the right to receive a clear explanation for the claim rejection. The insurer cannot arbitrarily deny your claim.
• Follow the Escalation Matrix: Systematically follow the grievance redressal process, starting from the insurer’s GRO, then the Ombudsman, and finally the Consumer Commission. Do not jump steps, as this can sometimes be used against you.
• Do Not Be Intimidated: Insurance companies may use complex jargon to justify a rejection. Do not be discouraged. Seek clarity and challenge any reason that seems unfair or contrary to your policy terms.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

How the police behave in such cases

It is important to understand that an insurance claim dispute is a civil matter, not a criminal one. Therefore, the police have no jurisdiction or role to play in such cases. Approaching the police will not yield any results, as they will rightly direct you to the civil grievance redressal mechanisms like the Insurance Ombudsman or the Consumer Commission. The only exception is if you have concrete evidence of criminal activity by the insurance company officials, such as forgery of documents or a systematic fraud scheme, which would require a different legal approach under the Bharatiya Nyaya Sanhita (BNS). However, for a standard claim rejection, the police are not the appropriate authority.

FAQs people normally have

Here are some common questions that arise in such situations:

• What is the time limit to file a complaint with the Insurance Ombudsman?
• You must approach the Ombudsman within one year of the insurance company’s final rejection of your representation.
• Can I claim compensation for mental agony and legal costs?
• Yes, when you file a case with the Consumer Commission, you can claim not only the insurance amount but also compensation for the mental harassment, financial loss, and the costs incurred in litigation.
• What happens if the insurance company does not honour the Insurance Ombudsman’s decision?
• An award passed by the Ombudsman is binding on the insurance company if the policyholder accepts it. If the insurer fails to comply, you can take the matter to the Consumer Commission or a civil court for enforcement.

What evidence is required?

Strong documentation is the backbone of your case. Ensure you have the following:

• The original health insurance policy document.
• The cashless claim rejection letter or email from the hospital/insurer.
• The reimbursement claim form and all supporting documents you submitted.
• All original hospital bills, payment receipts, pharmacy bills, and diagnostic reports.
• The hospital discharge summary.
• The final rejection letter for the reimbursement claim from the insurer.
• A complete record of all emails, letters, and communication with the insurance company.

How long will the investigation take?

The timeline can vary depending on the channel you choose:

• Insurer’s Grievance Cell: As per IRDAI, they should resolve the grievance within 15 days.
• Insurance Ombudsman: The process is relatively quick, with most cases being decided within 1 to 3 months.
• Consumer Commission: This process is more formal and can take longer. A case in the District Commission may take anywhere from 6 months to over a year, while State and National Commission cases can take longer.

Advocate Sudhir Rao, Supreme Court of India