43% consumers faced problems in health insurance claims: LocalCircles Survey

According to majority of those who commented on the subject, the process of claiming health insurance is extremely time consuming with many policyholders and their family members spending the last day of their hospital admission running around trying to get their claim processed.

“In several cases cited by policy holders on LocalCircles, it took 10-12 hours after the patient was ready for discharge for them to actually get discharged because the health insurance claim was still getting processed,” the survey said.

By the time the claim is approved, the patients are so tired that they have no energy to fight for any expenses that are disapproved by the insurance company. If they stay back at the hospital another day to do so, the cost of that additional night’s stay has to be borne by them.

According to several patients, this is the experience where the insurance company has already provided a pre-approval to the hospital’s TPA desk before admission of the patient, it said.

Despite some interventions by the Insurance Regulatory and Development Authority of India (Irdai), consumers continue to grapple with insurance companies to get their health claims. One of the top

issues that consumers have been regularly writing about is that of rejection of health insurance claims including cancellation of policies by insurance companies.

To understand how people buy general insurance, the kind of policies they buy and where they face the most issues, LocalCircles conducted a national survey which received over 39,000 responses from citizens located in 302 districts of India.

“67 per cent respondents were men while 33 per cent respondents were women. 46 per cent respondents were from tier 1, 32 per cent from tier 2 and 22 per cent respondents were from tier 3, 4 and rural districts,” it said.

The query received 11,318 responses with 93 per cent indicating that they are in favour of Irdai making it mandatory for insurance companies to disclose details of claims received, rejected, and also data about policies approved and policies cancelled on their websites each month. Only 7 per cent of the respondents indicated that “no” such a step is necessary. People believe that such a disclosure will improve transparency of reporting and discourage insurance companies from not cancelling policies arbitrarily.

One of the key concerns outlined by some health insurance policyholders was that the insurance companies tend to cancel policies during the claims process for reasons like pre-existing conditions. Almost one-third or 1.6 lakh cases out of total 5.5 lakh pending consumer complaints received by the Department of Consumer Affairs are of the insurance sector.

Six major issues faced by policy holders include lack of full disclosure about exclusions and eligibility for claims in their policies; ambiguity in contracts due to use of technical jargons and complex words; claims rejected due to pre-existing disease; eligibility other than the preexisting disease and crop insurance rules tied to the scheme.

The Consumer Affairs Department has also shared concern on the fact that agents hardly take any interest to guide or help policyholders after selling policies as their commissions are front-loaded.