Over 80% of the health insurance policyholders believe that there are delays in claims which are intentional, designed to pressure policyholders into accepting lower claim amounts.

According to a survey by LocalCircles, 60% of health insurance claimants reported experiencing delays of six to 48 hours between claim approval and hospital discharge.

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The survey, which included responses from over 100,000 health insurance policyholders across 327 districts in India.

This finding raises concerns as the Insurance Regulatory and Development Authority of India (IRDAI) mandates that claims should be settled within an hour to prevent discharge delays. When asked if they believed that the prolonged claim processing worked in favor of insurance companies, 47% confirmed this belief, with 34% stating it had not happened to them personally but had affected those in their close network. Only 7% dismissed this scenario as uncommon.

LocalCircles found that only 25% of survey participants reported that their health insurance claims in the last three years were fully approved by the insurance company. An additional 6% mentioned that their claim was eventually fully approved following some back-and-forth with the insurance company.

Furthermore, 33% of respondents stated that their claim was “only partially approved with invalid reasons”, while 36% said their claim was outright rejected with invalid reasons. Despite IRDAI’s directive for companies to settle claims promptly, with some even within an hour to prevent delays in hospital discharge, health insurance policyholders’ complaints indicate that this is not being consistently implemented, as highlighted by LocalCircles.

Out of 30,366 health insurance policy owners surveyed on claim settlement timelines, 21% reported that the discharge from hospital after claim settlement took 24-48 hours, 12% said it took 12-24 hours, 14% claimed it took 9-12 hours, and 12% mentioned it took 6-9 hours. Only 8% stated that the process was instant.

In the private sector, HDFC Ergo had the highest claim settlement ratio in 2023-24 at 94.32%, while Bajaj Allianz had the lowest at 73.38%, as per a report from the Insurance Brokers Association of India. The majority of health insurance policyholders surveyed feel that there is a lack of transparent web-based communication systems for claims processing and recommend that IRDAI mandate such systems.