A group health insurance policy is a valuable employee benefit, offering financial security during medical emergencies. However, claim rejections can be frustrating and confusing. Imagine expecting your insurance to cover a hospital bill, only to find out it’s been denied. Annoying, right?
Understanding the common reasons for claim rejection can help you avoid this situation. In this article, we’ll break down why group insurance claims get rejected and how you can prevent it.
Incomplete or incorrect documentation
One of the most common reasons for rejection is missing or incorrect documents. Insurance providers require proper paperwork to process claims. This includes:
- Hospital bills and receipts
- Doctor’s prescriptions
- Discharge summary
- Diagnostic reports
Even a small error, like a missing signature or an incorrect policy number, can lead to rejection. Always double-check your documents before submission.
Claiming for excluded treatments
Every group health insurance policy has a list of treatments and conditions it doesn’t cover. These exclusions are clearly mentioned in the policy document. Some common exclusions include:
- Cosmetic surgeries
- Dental procedures (unless due to an accident)
- Alternative treatments like naturopathy
Before making a claim, review your policy’s exclusions to ensure your treatment is covered.
Employer hasn’t renewed the policy
A group insurance policy is provided by an employer, and they are responsible for renewing it annually. If your employer forgets to renew it, your coverage lapses. This means any claims made during the lapse period will be rejected.
Always check with your HR department to confirm that your policy is active.
Claim exceeds the sum insured
Every group health insurance policy has a sum insured limit. If your hospital bill exceeds this limit, the insurer will only pay up to the allowed amount, and you’ll need to cover the rest.
For example, if your policy covers ₹5 lakh, but your bill is ₹7 lakh, the insurer will only reimburse ₹5 lakh. The remaining ₹2 lakh must be paid by you.
Delay in claim submission
Every insurance company has a time limit for submitting claims. Typically, you need to file:
- Cashless claims – Before hospital admission (except in emergencies)
- Reimbursement claims – Within a few days after discharge
Missing these deadlines can result in claim rejection. Always submit your claim as soon as possible.
Fraudulent or misleading claims
Insurance fraud is taken seriously. If an insurer suspects that a claim is fake or exaggerated, it will be rejected. Common fraudulent activities include:
- Fake hospital bills
- Treatment for a non-covered person
- Misrepresenting a pre-existing condition as a new illness
Ensure all claim details are genuine and correctly reported.
Employer has opted for a limited coverage plan
Employers can customise group insurance plans based on their budget. Some may exclude maternity benefits, OPD expenses or mental health treatments to keep costs low.
If your employer has opted for a basic plan, some claims may get rejected due to limited coverage.
How to avoid claim rejections?
Now that we know why group health insurance policy claims get rejected, here’s how to prevent it:
- Read the policy terms carefully, including inclusions and exclusions.
- Ensure all medical history details are correctly provided.
- Choose a network hospital for cashless treatment.
- Submit complete and accurate documentation.
- File claims within the required time frame.
- Check if the employer has renewed the policy.
- Seek pre-authorisation for high-cost procedures.
By following these steps, you can reduce the chances of claim rejection and ensure a hassle-free experience.
Conclusion
A group insurance policy is a great benefit, but claim rejections can be frustrating. Understanding the reasons behind it can help you avoid unnecessary stress. Always be informed, follow the claim process correctly and stay in touch with your insurer or HR team to ensure smooth claim approvals.