Understanding Insurance Claim Settlements – Tips & Checklist

Health Insurance Claim Settlement

Health insurance claims typically come in two forms:

1. Cashless Claim (Preferred for Network Hospitals):

• When to Use: When you receive treatment at a hospital that has a direct tie-up (network hospital) with your insurance company.
• Process:
  1. Planned Hospitalization: Inform your insurer or Third-Party Administrator (TPA) 2-3 days in advance.
  2. Emergency Hospitalization: Inform your insurer/TPA within 24 hours of admission.
  3. Admission: At the hospital's insurance desk, present your health insurance card and a valid ID.
  4. Pre-Authorization Form: The hospital's TPA desk will help you fill out a pre-authorization form. This form details your medical condition, proposed treatment, and estimated cost.
  5. Submission & Approval: The hospital sends this form to your insurer/TPA. The insurer reviews the request and, if approved, sends an authorization letter to the hospital.
  6. Treatment & Discharge: You receive treatment. At discharge, the insurer settles the approved bill directly with the hospital. You only pay for non-covered expenses (e.g., deductibles, co-pays, items not part of the standard treatment).

1. Reimbursement Claim (For Non-Network Hospitals or if Cashless is Denied):

• When to Use: When you receive treatment at a non-network hospital, or if your cashless request is denied (e.g., due to incomplete documentation, non-covered treatment, or late intimation).
• Process:
  1. Intimate Insurer: Inform your insurer/TPA within 24-48 hours of emergency hospitalization or as per policy terms for planned hospitalization.
  2. Pay Bills Upfront: Pay all hospital bills and medical expenses yourself.
  3. Collect Documents: Gather all original documents from the hospital and pharmacy.
  4. Submit Claim Form & Documents: Fill out the claim form provided by your insurer and submit it along with all required original documents to the insurer/TPA within the stipulated time frame (usually 15-30 days from discharge).
  5. Verification & Settlement: The insurer reviews the documents. If approved, the eligible amount is reimbursed to your bank account.

Common Documents for Health Claims:

• Duly filled and signed claim form
• Original policy document/copy of e-card
• Copy of ID proof of the policyholder
• Original hospital bills and receipts
• Original discharge summary/certificate
• All investigation reports (X-rays, MRI, blood tests, etc.)
• Prescriptions and pharmacy bills
• Medico-legal certificate (MLC) / FIR (in case of accident)
• Cancelled cheque for NEFT (for reimbursement)
• Doctor's consultation papers/referral letter

2. Life Insurance Claim Settlement

Life insurance claims are typically triggered by the death of the policyholder or the maturity of the policy.

1. Death Claim:

• When to Use: When the policyholder passes away during the policy term.
• Process:
  1. Intimation: The nominee(s) or legal heir must inform the insurance company as soon as possible, providing basic details like policy number, insured's name, date, cause, and place of death.
  2. Claim Form & Documents: Obtain the death claim form from the insurer (online or branch) and fill it out accurately.
  3. Submission: Submit the filled form along with all necessary original documents.
  4. Verification: The insurer will verify the documents. For deaths within the initial 2-3 years of the policy, or if the cause of death is suspicious, a detailed investigation may occur.
  5. Settlement: If approved, the Sum Assured (and any accrued bonuses) is paid to the nominee(s) via NEFT.

Common Documents for Death Claims:

• Duly filled death claim form
• Original policy document
• Original death certificate of the insured
• Claimant's statement form
• Nominee's ID and address proof
• Bank account details of the nominee (cancelled cheque)
• Medical records and treatment papers (if death due to illness)
• FIR, post-mortem report, inquest report (in case of accidental or unnatural death)
• Employer's certificate (if employed)
• Age proof of the deceased (if not already submitted)

1. Maturity Claim:

• When to Use: When an endowment or money-back policy completes its full term, and the policyholder is alive.
• Process:
  1. Intimation/Form: The insurer usually sends a maturity claim discharge form to the policyholder a few months before maturity.
  2. Submission: Fill out the form and submit it along with the original policy document and ID proof.
  3. Settlement: The maturity benefit is paid to the policyholder on or around the maturity date.

Common Documents for Maturity Claims:

• Duly filled maturity claim discharge form
• Original policy bond
• Age proof (if not already admitted)
• Bank account details (cancelled cheque)
• ID and address proof of the policyholder

3. Motor Insurance Claim Settlement (Car/Bike)

Motor insurance claims cover damages to your vehicle (Own Damage - OD), theft, or third-party liabilities.

1. Own Damage Claim (Cashless/Reimbursement):

• When to Use: When your vehicle is damaged due to an accident, natural calamity, fire, or theft.
• Process:
  1. Immediate Intimation: Inform your insurer immediately after the incident (within 24-48 hours). Provide policy number, date, time, location, and description of the incident.
  2. FIR (if required): File an FIR with the police if the accident involves third-party injury/death, major property damage, theft, or vandalism.
  3. Surveyor Inspection: The insurer will appoint a surveyor to inspect the damaged vehicle. Do NOT move or repair the vehicle before the surveyor's inspection.
  4. Vehicle to Garage:
     • Cashless: Take your vehicle to a garage from the insurer's network. The garage will prepare an estimate.
     • Reimbursement: Take your vehicle to any garage of your choice, get it repaired, and pay the bills.
  5. Document Submission: Submit all required documents to the insurer/surveyor/network garage.
  6. Settlement:
     • Cashless: The insurer settles the bill directly with the network garage (after deducting deductibles and depreciation). You pay the remaining amount.
     • Reimbursement: Submit original repair bills and receipts. The insurer verifies and reimburses the approved amount to your bank account.

1. Third-Party Liability Claim:

• When to Use: When your vehicle causes damage/injury/death to a third party.
• Process:
  1. FIR: Immediately file an FIR with the police.
  2. Intimation: Inform your insurer.
  3. Legal Process: These claims are typically settled through the Motor Accident Claims Tribunal (MACT). Your insurer's legal team will handle the case. You must cooperate fully with all information and documents.

1. Theft Claim:

• When to Use: When your vehicle is stolen.
• Process:
  1. FIR: Immediately file an FIR with the police.
  2. Intimation: Inform your insurer.
  3. Non-Traceable Report (NTR): If the vehicle is not traced by the police within a specific period (usually 30-90 days), obtain a "Non-Traceable Report" from the police.
  4. Documents: Submit all required documents, including the FIR, NTR, original RC, keys, etc.
  5. Settlement: The insurer will settle the claim for the Insured Declared Value (IDV) of the vehicle.

Common Documents for Motor Claims:

• Duly filled and signed claim form
• Copy of policy document
• Copy of Vehicle Registration Certificate (RC)
• Copy of valid Driving License of the person driving at the time of incident
• FIR copy (mandatory for major accidents, theft, third-party claims)
• Original repair bills and payment receipts (for reimbursement)
• Repair estimate from garage (for cashless)
• Photos/videos of the damaged vehicle/accident scene
• Non-Traceable Report (for theft claims)
• Keys, service book, warranty card (for theft claims)

 

Important Points for a Smooth Claim Experience

• Read Exclusions: Be aware of what your policy does not cover. Claiming for an excluded event will lead to rejection.
• Don't Hide Information: Always declare pre-existing conditions or previous claims truthfully during policy purchase. Non-disclosure is a major reason for claim rejection.
• Policy Lapse: Ensure your policy is renewed on time. A lapsed policy means no coverage.
• Maintain Records: Keep copies of all documents submitted to the insurer and any communication (emails, reference numbers).
• Seek Advisor's Help: If you have an insurance advisor, leverage their expertise. They can guide you through the process, help with documentation, and follow up with the insurer on your behalf.
• Grievance Redressal: If your claim is unfairly rejected or delayed, you can escalate the matter to the insurer's grievance redressal officer, then to the IRDAI's Integrated Grievance Management System (IGMS), and finally to the Insurance Ombudsman.