Most denials come from mistakes made long before the hospital bill arrives
For millions of Indian families, health insurance is meant to be a safety net. Too often, the net has holes that policyholders discover only in a hospital corridor.
The scale of the problem is visible in official figures. In a Lok Sabha reply, the government said health insurance complaints on the BimaBharosa portal rose from 47,658 in FY 2023-24 to 64,365 in FY 2024-25, and reached 73,729 in FY 2025-26 up to February 2026. One industry report put claim rejections at nearly 8 per cent in FY25.
Experts say many of these rejections are avoidable. These are the most common reasons.
1. Non-disclosure of existing conditions- This is the most frequent trigger. Insurers compare the proposal form with hospital records, and a mismatch may lead to rejection when the treatment relates to an undisclosed condition. A buyer who skips mention of diabetes, hypertension or a past surgery to keep the premium low may find the claim denied when it matters most.
2. Claiming during a waiting period- Most policies do not cover pre-existing diseases immediately, and specific treatments such as cataract, joint replacement or hernia carry their own waiting periods. A claim filed inside that window will be turned down, however genuine the illness. Under IRDAI’s 2024 norms, the maximum waiting period for pre-existing conditions was reduced to three years, but it still applies, so check what your policy states.
3. Treatments the policy excludes- Cosmetic procedures, certain dental work, infertility treatment and some lifestyle-related conditions are commonly excluded. Many people assume “health insurance” covers anything done in a hospital. It does not.
4. Sub-limits and room rent caps- These cause partial payment rather than outright rejection, but the effect on the family is similar. If your policy caps room rent and you choose a costlier room, the insurer may reduce the entire bill proportionately, including surgeon fees and other charges linked to room category.
5. Missing or incorrect documents- Unsigned forms, missing discharge summaries, unclear bills or mismatched names are routine reasons for delay and denial. Late intimation is another: most policies expect notice of planned hospitalisation in advance and of emergency admission within 24 hours or so.
6. Hospitalisation seen as unnecessary- Insurers can reject claims where the admission was only for diagnostics or observation that could have been done as an outpatient. Doctors’ notes explaining why admission was medically necessary carry weight here.
7. Lapsed policies- A policy that is not renewed on time can lose its continuity benefits or lapse entirely. Waiting periods may then start again from zero.
What the regulator says- IRDAI requires insurers to communicate specific reasons for rejection to the claimant, with reference to the relevant policy terms and conditions, and rejections must be approved by designated committees before they are final. The regulator has also pushed for faster cashless approvals and discharge clearances.
Under IRDAI’s 2024 rules, after five continuous years of coverage, an insurer generally cannot reject a claim on grounds of non-disclosure, except in cases of proven fraud. This “moratorium” period was earlier eight years.
What policyholders can do
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Disclose every medical condition honestly, even if it raises the premium.
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Read the policy wording for waiting periods, exclusions and sub-limits before buying.
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Pick a room category within your policy’s limit.
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Keep all prescriptions, reports and bills, and get the discharge summary signed.
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Inform the insurer or TPA promptly about any hospitalisation.
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Renew on time, using auto-renewal where possible.
If a claim is rejected, ask for the reason in writing, then file a complaint with the insurer’s grievance cell. If that fails, escalate through the IRDAI BimaBharosa portal or approach the Insurance Ombudsman, which can be done free of charge.