How to Handle the Claim Settlement Process with Multiple Health Policies?
Published On Mar 07, 2019 5:30 AM By Gunjan Anand
The rising cost of medical treatments lead the customers to buy health insurance with higher sum insured. But, due to several factors, insurers don’t agree to allow policyholders for purchasing a policy beyond a specific limit of the insured amount. This compels many insured individuals to acquire multiple health insurance plans. However, people do own different policies at a time, when they need to have distinctive medical schemes for parents, kids, spouse, etc., due to unavailability of sufficient cover in a single plan.
Holding more than one policy is not bad if you understand how to use them aptly and making health insurance claims accordingly. There exist certain regulations that must be followed by for optimum utilization of multiple plans and safeguarding yourself from facing the rejections in the claim settlement process as well. The procedure states that while opting for another policy, one needs to disclose the insurer about the existing policy. Failing to do this may lead to a violation of insurance terms, and the policyholder may need to bear the burden of medical bills on his or her own as the claim may not get approved in that case.
The disclosure is essential due to the contribution clause. According to which, if someone is buying a health insurance plan in India while holding a policy or policies already, he or she needs to share their details. So, when a claim is made, all the insurance providing companies will be sharing the claim amount in the ratio as per the sums insured under different policies. For instance, if a person owns two health plans, where one is insured with Rs 2 lakh sum, while another for Rs 4 lakh. Now, if the person makes a claim for Rs 2 lakh, then, the first insurance company will bear Rs 66,666 and the second one will pay Rs 1,33,333.
However, recently, the health insurance claim settlement procedure has been modified to make it simple. This has been done by the health insurance regulators by mitigating the contribution clause to some extent. Like, previously, an insured individual needed to inform every of his or her insurer, who would pay for the claim amount in the ratio of the sum insured. But, with the new regulations, notifying any of the insurers will work.
Here is the example to simplify the above point.
Let’s assume you purchased two health plans:
- Insurer 1 with sum assured of 3 lakh and no co-payment clause
- Insurer 2 with sum assured of 3 lakh and 20% co-payment
Now, you get hospitalized, and your hospital bill runs around 4 lakh
Case 1: You approach Insurer 1 first, you receive 3 lakh and for the remaining amount you approach Insurer 2, the second insurer has the co-payment clause, so 80% of 4 lakh comes to 3.2 lakh. Out of which 3 lakh is already paid by Insurer 1, so Insurer 2 pays you only Rs 20,000 and rest Rs 80,000 you need to pay from your pocket.
Case 2: You approach Insurer 2 first, the total claim of 4 lakh with a 20% co-payment. Thus, 80% of 4 lakh is 3.2 lakh. You receive permissible limit 3 lakh and rest 1 lakh you get from Insurer 1.
If the claim amount exceeds the sum assured of a single plan, then the remaining balance can be claimed before the second insurer. For this, the policyholder is required to submit the relevant and original documents and receive the certificate of settlement from the first insurance provider, then only he or she can approach the second insurer with photocopies of documents to claim the remaining balance. The insurer can apply the contribution claim for claim settlement as depicted in the examples above. Suppose instead of 4 lakh your hospital bill runs around 3 lakh or less. In that case, you are free to choose any of the insurers, and the total amount of 3 lakh or less will be settled by either Insurer 1 or Insurer 2.
Steps to file the claims from multiple insurers successfully:
- Notify every insurer about your hospitalization
- Select the insurance company from where you want to make the claim first. Then get the form and fill it.
- Try to provide and submit all the required documents and bills in their original form.
- After that, the first insurer has to issue a statement that it has received all the original documents and claims have been settled.
- Also, a policyholder can also acquire attested copies from the hospitals and clinics for every insurer you wish to claim.
- After the first insurer approves the claim, collect claim settlement summary and approach to the second insurer. Similarly, move to other insurers too.
- Fill in their claim forms correctly, attach the claim settlement summary and attested copy with it.
- Prepare a covering letter, in reference to the insurance company you have made a claim through, enclosed with the important documents and details.
- Repeat the above-described process to make a claim from another insurance providing company.
- The policyholders are expected to receive the claim in a few weeks.
Apart from following these steps, certain points should be considered by every policyholder while initiating the claim settlement process. Here are some points to remember about making an insurance claim:
A) Each claim procedure usually takes around 30-45 days to complete. For cashless related claims, the claim settlement by the first insurance company will be cashless. At this point the principal medical coverage organisation figures the amount of the claim to be paid, which comprise of deductions and appropriate sub-limits against the claim sum, before settling the claim amount, while the rest of the claims are repaid later. Afterwards, the second insurer will pursue a similar procedure and treat it as if the claim has been initially made. In the wake of landing at the payable claim sum, the sum got from the primary insurance provider will be deducted, and the remaining one will be paid out.
B) If someone is equipped with the group as well as an individual cover, it’s suggested to reach your group insurance provider first for the claim. The primary reason behind this approach is that group plans don't acquire confounded clauses and helps to make the claim procedure faster. In addition to this, the employer insurance covers/plans have lower or zero waiting period, and they cover pre-existing ailments from the very beginning too. No matter how many claims you made, it does not influence future premiums. Also, if the whole claim is settled through the group insurance policy, No Claim Bonus (NCB) of the individual insurance plan goes unaffected during renewal.
C) If a policyholder acquires two individual health covers, it is prudent to avail the older plan first for settling the amount of the claim, as the waiting period related to pre-existing ailments of the older cover diminish with the passing time. In addition to this, while making the claim from two plans, first go with a plan that has relevant sub-limits to comprehend deductions made under various heads like specialist's fare, medical clinic room rent and so on. The second insurance provider at that point repays the balance amount.
D) Opting for the top-up and super top-up schemes or enhancing the amount of sum assured under the same insurance plan at the time of renewal, avoid making the claims from different small insurance plans.
E) With the inclusion of a super top-up plan in the regular plan, you can initiate multiple claim settlement in a single year as it comprises all expenses from hospitalization to treatment-related bills in a policy year. The insurance providing firm repays the amount of the claim notwithstanding when the claim overshoots the limit of the deductible.
How to Speed Up Health Insurance Claim Settlement Process?
Taking various health care coverage plans to assure money related security amid the medical crisis is something the majority of people do. Be that as it may, it is vital to comprehend every health insurance policy in detail to know in detail about its terms and conditions, inclusions and rejections. This mainly works as a catalyst when it comes to the procedure of claim settlement.
However, as an option, one can opt for a single medical coverage plan with a higher insured amount rather than having various sorts of little covers. Although, if someone holds several small plans, he or she should consider merging them into a solitary policy or maximum into two plans. This gives you an adequate cover and saves a lot of time from being indulged into complicated paperwork and extensive claim procedures.