How to read the claim settlement letter and deduction sheet line by line

Read it in three passes: first the totals (amount claimed, amount admitted, amount paid), then each deduction line with the reason given, then the clause behind each reason in your own policy. A partial disallowance should come with details that refer to specific policy terms, so a line with no reason, or a reason with no clause, is the one to ask about. Keep the hospital's itemised bill beside you throughout.

For a health claim, the master circular says that when a claim is "disallowed partially, details shall be conveyed to the claimant along with full details giving reference to the specific terms and conditions of the policy document". The settlement letter and its computation (or deduction) sheet are where those details should be.^[1]

For motor and other retail general policies, the Customer Information Sheet you received with the policy should set out the "principle for admissibility of claim" and a "sample claim calculation process" — useful to read beside the insurer's working.^[2]

Read it line by line

1. 1

   Start with the totals

   Amount claimed or billed, amount admitted, deductions, and amount paid. Check that they add up.

2. 2

   Match each line to the bill

   The sheet may group items. If a group is cut and you cannot see what is in it, ask for an item-level breakdown.

3. 3

   Name each deduction's type

   Non-payable item (consumables), proportionate cut (room rent), sub-limit, co-payment, deductible, "reasonable and customary" (benchmark cuts) or an exclusion.

4. 4

   Find the clause for each

   Write the clause number next to the line. An exclusion has to be in your policy document; no deduction may be made in the name of any other exclusion.^[2]

5. 5

   Check the order of the calculation

   A co-payment is a percentage of the admissible claim amount, so check that it was applied to the admissible amount, not to the whole bill.^[3]

6. 6

   Check the dates

   Compare the payment date with the date you submitted the claim. A health reimbursement claim is to be settled within fifteen days of submission; late settlement carries interest. See settlement time and interest on delay.^[2]

A check sheet you can copy

What to do with the result

Write one letter listing only the lines you question, each with the clause and your reason, and keep everything else out. The insurer should resolve the complaint within 14 days, giving reasons that refer to the policy terms if it does not accept it.^[2]

If you are asked to sign a discharge voucher before the money is released, read what signing it means first.

ClaimAssure is an independent private platform. It is not an insurer, IRDAI, Bima Bharosa or the Insurance Ombudsman, it never files anything on your behalf, and it cannot promise any outcome. What it does is read your documents and show you what they say.

More on claim delays and partial settlements