Health insurance claim partially settled — why was less paid?

A short payment can come from one or more of these: a co-payment, a deductible, a sub-limit (for example on room rent or a named treatment), a proportionate cut because the room cost more than your limit, items your policy lists as not payable, or a cut to "reasonable and customary" charges. For a health claim that is partly disallowed, the insurer has to give you full details with reference to the specific terms of the policy. Match every deduction to a clause in your own wording; any deduction you cannot trace to the policy is the one to question.

Start with what the insurer owes you by way of explanation. Under the health master circular, 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". A payment message with only a total is not that.^[1]

The policy also has to state, in advance, its sub-limits, its proportionate deductions and whether any package rates exist, with a cross-reference to the policy section. And IRDAI's 2024 master circular says no deduction may be made "in the name of any other exclusions" than those written into the policy document.^[2]

The usual reasons, and where to check each

How to check a partial settlement

1. 1

   Get the settlement letter and the deduction sheet

   If you only have a payment message, ask for the computation sheet in writing. See reading the settlement sheet line by line.

2. 2

   Get the hospital's itemised final bill

   The deduction sheet can group items; the itemised bill lets you see what each group contains.

3. 3

   Find the clause for each deduction

   Write the clause number beside each line. A line with no clause you can find goes on your list of questions.

4. 4

   Check the arithmetic

   Wordings such as New India's define a co-payment as a percentage of the admissible claim amount, so check that it was applied to the admissible amount and not to the full bill.^[3]

5. 5

   Write once, listing every line you question

   Give the line, the amount, the reason given and why you think it does not apply. An insurer should resolve a complaint within 14 days, with reasons that refer to the policy terms if it does not accept it.^[2]

Deductions worth questioning

• A deduction with no clause named: Ask for the specific term relied on.^[1]
• An exclusion that is not in your policy: No deduction may be made in the name of an exclusion the policy document does not contain.^[2]
• A proportionate cut on charges your wording exempts: One wording exempts medicines; another exempts pharmacy, consumables, implants and diagnostics, and does not apply the cut where the hospital's charges do not vary by room. See room rent and proportionate deduction.^{[3, 4]}
• Consumables cut under a general heading: Check each item against your policy's annexure. See consumables and non-payable items.
• A "reasonable charges" cut with no benchmark: Ask what comparison was used. See reasonable and customary charges.

If the insurer's reply does not settle it, a partial repudiation of a claim is one of the grounds the Insurance Ombudsman can hear, within one year of the insurer's reply to your complaint.^[5]

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