# Health Insurance Claim Rejection: Reasons & Fixes > Why health insurance claims get rejected or cut, what IRDAI says insurers cannot do, and how to appeal via the insurer, Bima Bharosa and the Ombudsman. - **Published**: 2026-10-18 - **Modified**: 2026-10-18 - **Category**: health-insurance - **URL**: https://www.tldr.money/articles/health-insurance/health-insurance-claim-rejection-reasons --- A rejected or heavily cut claim is the worst moment to learn how your policy works. This guide, part of our [health insurance in India](/health-insurance) hub, covers the main reasons for **health insurance claim rejection**, the rules insurers must follow, and how to fight back. ## Rejection vs deduction There are two different outcomes, and it helps to know which you are facing: - **Rejection (repudiation):** the insurer pays nothing, usually citing non-disclosure, a waiting period or an exclusion. - **Partial settlement (deduction):** the insurer pays part of the bill, cutting items for room rent, co-pay, sub-limits or non-payable items. Deductions are more common and often feel like rejection when they run to tens of thousands of rupees. ## The common reasons for rejection ### 1. Non-disclosure of medical history If you left a condition off the proposal form and the claim is linked to it, the insurer can reject the claim and may cancel the policy. Until you have **60 months of continuous cover**, non-disclosure or misrepresentation can be used against you. After that moratorium, IRDAI's rules say the policy and claims cannot be contested on those grounds, except for established fraud. See our [pre-existing disease guide](/articles/health-insurance/pre-existing-disease-health-insurance). ### 2. Claiming inside a waiting period Illness in the first 30 days, a listed condition inside its specific waiting period, or a declared PED inside its waiting period will be rejected. Waits restart on any increase in sum insured. The full picture is in our [waiting periods guide](/articles/health-insurance/health-insurance-waiting-periods). ### 3. Permanent exclusions Policies exclude some treatments outright, such as cosmetic surgery, or treatment for conditions caused by substance abuse. IRDAI standardised the wording of many of these exclusions in 2020, so check the "Exclusions" section of your policy wording. ### 4. Hospitalisation not medically necessary Admissions mainly for diagnostic tests or for treatment that could have been given as an outpatient are a common dispute. Keep the doctor's notes that explain why admission was needed. ### 5. Not an admissible treatment or hospital Claims at a facility that does not meet the policy's definition of a hospital, or for treatment types the policy limits, can be rejected or capped. ## The common reasons for deductions | Deduction | What happens | How to avoid it | |---|---|---| | Room rent limit | Room charge capped, and linked charges cut proportionately | Choose a plan with no room cap, or stay within it. See [room rent and proportionate deduction](/articles/health-insurance/room-rent-capping-proportionate-deduction) | | Co-pay | You pay a fixed share of each admissible claim | Know your co-pay before admission. See [co-pay vs deductible](/articles/health-insurance/co-pay-vs-deductible) | | Sub-limits | Caps on named treatments such as cataract | Read the sub-limit table in the policy schedule | | Non-payable items | Consumables and admin charges listed as not payable | Check IRDAI's list of non-payable items in your policy wording, or buy a consumables add-on | | Sum insured exhausted | Bill exceeds remaining cover | Size cover for a serious hospitalisation in your city, with headroom | ## What IRDAI says insurers cannot do IRDAI's 2024 master circulars on health insurance and on protecting policyholders set clear rules: - **No rejection for paperwork or delay.** No claim shall be rejected or closed for want of documents or for delayed intimation. - **The insurer collects the documents.** After you intimate a claim, the insurer or TPA must collect the documents it needs from the hospital. - **Rejections need senior sign-off.** No claim can be repudiated without approval from the insurer's Product Management Committee or a three-member Claims Review Committee. - **Reasons must cite the policy.** A rejection or partial settlement must be explained with reference to the specific terms and conditions of the policy. - **Fifteen days to settle.** Claims other than cashless must be settled within 15 days of submission. Late settlement earns you interest at the bank rate plus 2%, paid by the insurer without you asking. - **Cashless timelines.** Insurers must decide on a cashless request within one hour and give final discharge authorisation within three hours. If delay beyond three hours leads to extra hospital charges, the insurer pays them from its shareholders' funds. See [cashless vs reimbursement claims](/articles/health-insurance/cashless-vs-reimbursement). ## How to appeal a rejection or deduction 1. **Get the reasons in writing.** Ask for the rejection letter and the itemised settlement statement, with the policy clauses cited. 2. **Check the clause against your policy wording.** Many disputes turn on whether a condition really was pre-existing, or whether a deduction matches IRDAI's rules. For example, proportionate deduction cannot be applied to medicines, consumables, implants, diagnostics or ICU charges. 3. **Write to the insurer's grievance redressal officer.** Attach your documents and say exactly what you are disputing. IRDAI expects a resolution within 14 days. You can also register the complaint on IRDAI's Bima Bharosa portal (bimabharosa.irdai.gov.in). 4. **Go to the Insurance Ombudsman.** If you are not satisfied, you can file a complaint with the Ombudsman for your area for claims up to Rs 50 lakh. It costs nothing. Details are at cioins.co.in. The insurer must comply with an Ombudsman award within 30 days or pay a penalty of Rs 5,000 a day to you. 5. **Consumer commission.** You can also approach a consumer disputes commission, which is a separate route. ## How to avoid a rejection in the first place - Disclose every condition and treatment on the proposal form. See the [health insurance buying checklist](/articles/health-insurance/health-insurance-checklist). - Read the waiting-period, exclusion, room rent and sub-limit sections before you are admitted. - Use network hospitals for cashless where possible, and intimate planned admissions in advance. - Keep copies of all reports, prescriptions and bills. For the step-by-step process of filing a claim, read our [health insurance claim process guide](/articles/health-insurance/health-insurance-claim-process). For insurer-level data, see [claim settlement ratios by company](/articles/health-insurance/top-claim-settlement-ratio-companies), but remember a ratio cannot tell you whether a particular claim will be paid. ## Sources - IRDAI, Master Circular on Protection of Policyholders' Interests (IRDAI/PP&GR/CIR/MISC/117/9/2024), 5 Sep 2024, Part B (health claims, grievances, Ombudsman): https://irdai.gov.in/en/document-detail?documentId=5625747 - IRDAI, Master Circular on Health Insurance Business (IRDAI/HLT/CIR/PRO/84/5/2024), 29 May 2024, Chapter I paras 15-17 and 20: https://irdai.gov.in/en/document-detail?documentId=4942918 - IRDAI (Insurance Products) Regulations, 2024, Schedule III, para 8 (moratorium): https://irdai.gov.in/consolidated-gazette-notified-regulations - IRDAI, Norms on Proportionate Deductions, 11 Jun 2020: https://irdai.gov.in/en/document-detail?documentId=394680 - Council for Insurance Ombudsmen: https://www.cioins.co.in/ - IRDAI Bima Bharosa: https://bimabharosa.irdai.gov.in/ --- - [More health-insurance articles](https://www.tldr.money/articles/category/health-insurance) - [All articles](https://www.tldr.money/articles)