A critical illness insurance policy is a great way to mitigate the financial burden of life-threatening diseases. The lump-sum payment provided by such a policy can help the diagnosed and their family to seek better treatment, thus increasing the chances of combating the illness. The lump-sum is paid only after a claim is raised, verified and settled. Though in most cases the claims get approved, there is still a possibility of rejection. An understanding of how and why that happens can help you avoid rejections and increase the chances of your claim getting approved. Let’s get to know 4 reasons why your critical illness insurance claim can get rejected.
- The illness/event/procedure is not covered in the plan
Most insurance companies cover a wide variety of critical illnesses, surgical procedures and medical events. However, there is always the chance that certain illnesses are not covered in the plan.
Moreover, some illnesses have various types and kinds. Some types of the disease may be covered while other types excluded. In the instance of cancer, for example, while most medical insurance companies cover breast cancer, cervical cancer, lung cancer, and so on, they usually do not cover skin cancer. So, a claim raised on the diagnosis of lung cancer may be approved but that does mean that all diseases that come under the umbrella of ‘cancer’ are covered.
- The stage and severity of the illness is not covered
Many critical illnesses have various stages to their diagnosis. Whether your claim gets approved or not also depends on the stage and severity of your illness. For example, motor neuron disease is covered by many insurers only if it results in permanent symptoms. Raising a claim for motor neuron disease otherwise may lead to rejection of the claim.
This is why many critical illness policies have the phrase, ‘XYZ disease of a specified severity covered’. The understanding of ‘severity’ may differ from insurer to insurer, so it advisable to read the policy wordings.
- Relevant medical information has been hidden
Critical illnesses have various causes, some genetic and some environmental. When you are buying a critical illness insurance policy, the insurer will ask you to provide several details regarding your past medical history and your present lifestyle. It is absolutely paramount that you give honest information at this stage as this helps the insurer determine your risk profile. For example, you may be asked if your parents suffered from any critical illness or whether you are a smoker. If you suppress or misrepresent the information, then the insurer may even reject your claim when you are diagnosed with a critical illness, regardless of whether it is covered or not.
- Illness caused is due to an excluded clause
Like medical insurance policies, critical illness plans, too, have their set of exclusions. If you are diagnosed with a covered illness, have to undergo major surgery or have suffered through a traumatic medical event due to excluded clauses, then your claim may likely be rejected. Some excluded clauses include self-inflicted injuries, intervention due to sports or adventurous activity or defence operation, and substance abuse.
A genuine claim is always addressed and taken seriously by reputed insurance companies. That is why it is necessary that you read the critical illness insurance policy wordings carefully and talk to your agent to become a well-informed policyholder and raise genuine claims.
