Lok Sabha Question No. 93 (UNSTARRED), answered on 2025-02-03
Subject: Rejection of Insurance Claims
Ministry: FINANCE
Asked by: Shri Balashowry Vallabhaneni, Adv Dean Kuriakose

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION No. 93

TO BE ANSWERED ON MONDAY, 3 rd  FEBRUARY, 2025/ 14 MAGHA, 1946 (SAKA)

## REJECTION OF INSURANCE CLAIMS

93.  Shri Balashowry Vallabhaneni: Adv Dean Kuriakose:

Will the Minister of Finance be pleased to state:

- (a)  whether the Insurance Regulatory and Development Authority of India (IRDAI) has stated that health insurance claims worth 15,100 crores have been rejected in the year 2023-24 and if  so, the details thereof, insurance company-wise;
- (b)  whether the terms and conditions of health insurance companies run into many pages with very small font size which really frustrates those who want to take policy and they invariably sign the policy document without reading the terms and conditions  of  the  policy  and  insurance  companies  taking  advantage  of  this  in rejecting or repudiating claims and if so, the measures taken by the Government in this regard;
- (c)  whether the Health Insurance Companies had received premiums to the tune of Rs. 1,07,681 crore for the same period and if so, the details thereof, State-wise;
- (d)  whether the ratio of claim settlement by public sector insurance companies is better in comparison to private sector insurance companies; and
- (e)  whether the Government is impressing upon private sector companies to be more humane in settling the claims and if so, the details thereof?

## ANSWER

THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

- (a) :  The Insurance Companies process the claims as per the terms and conditions of the policy.  The company-wise break up of data pertaining to health insurance claims, disallowed or repudiated by insurance companies, in the year 2023-24 is attached as Annexure-I.
- (b) :  In order to ensure that customers are fully aware about terms & conditions of the policy and to prevent mis-selling, IRDAI has mandated  that:-
- i. Insurance companies will provide Customer Information Sheet (CIS) to each health insurance policyholder. CIS shall provide details of coverage offered, exclusions, sub-limits/deductibles, capping, waiting period(s) etc.
- ii. Font size of at least eleven (11) to be used  in insurance policies.
- iii. Appropriate  framework  to  be  put  in  place  by  insurers  to  ensure  that  the features, benefits along with terms and conditions of the products being sold are represented correctly and fully and that the products are not mis-stated or misrepresented to prospects or policyholders.
- iv. Free look period of 30 days (from the date of receipt of the policy document) is given to the policyholder to review the terms and conditions of the policy. If he/she is not satisfied with any of the terms and conditions, he/she has the option to cancel his/her policy.

(c) :  The details of state-wise health insurance premium collected by insurers during last 3 Financial years as per IRDAI is provided in Annexure-II.

(d) :  The details of claimed settled by public and private sector insurance companies is provided in Annexure III.

(e) : IRDAI has further advised the insurance companies to take various measures to improve the customer claim settlement experience.  Some of the measures are:

- i. No claim  shall  be  repudiated  without  the  approval  of  the  Insurer's  Product Management Committee (PMC) or a three-member sub-group of PMC called the Claims Review Committee (CRC).
- ii. In case, the claim is repudiated or rejected or disallowed partially, details shall be communicated to the claimant along with full details giving reference to the specific terms and conditions of the policy document.
- iii. If a customer is not satisfied with decision of the insurer on the claim, he/she may  lodge  a  complaint  with  grievance  redressal  officer  of  insurer.    The policyholders have the right to approach the Insurance Ombudsman without any charges. Insurers must comply with the Ombudsman's decision within 30 days, or they need to pay penal charges of Rs. 5000 per day for each day of delay.
- iv. Shorter timelines  for  processing  and  settlement  of  claims  have  been introduced for reimbursement/  cashless  claim settlement and  for preauthorisation.
- v. Suo-moto payment of interest at bank rate plus 2 percent in event of delay beyond specified timelines.

********

## Annexure-I

## Reply to Lok Sabha Unstarred Question No. 93 for answer on  03.02.2025

| Data related to health claims disallowed/repudiated during FY 2023-24   | Data related to health claims disallowed/repudiated during FY 2023-24   | Data related to health claims disallowed/repudiated during FY 2023-24   | Data related to health claims disallowed/repudiated during FY 2023-24   |
|-------------------------------------------------------------------------|-------------------------------------------------------------------------|-------------------------------------------------------------------------|-------------------------------------------------------------------------|
| S.no.                                                                   | Insurers                                                                | Claims disallowed as per terms and conditions of policy contract        | Claims repudiated during the period                                     |
| Amount (in lacs) Amount (in lacs) Private Sector Insurers               | Amount (in lacs) Amount (in lacs) Private Sector Insurers               | Amount (in lacs) Amount (in lacs) Private Sector Insurers               | Amount (in lacs) Amount (in lacs) Private Sector Insurers               |
| 1                                                                       | Acko General Insurance Ltd.                                             | 8,867.86                                                                | 16,633.78                                                               |
| 2                                                                       | Bajaj Allianz General Insurance Co. Ltd.                                | 70,761.60                                                               | 33,246.81                                                               |
| 3                                                                       | CholamandalamMS General Insurance Co. Ltd.                              | 1,989.80                                                                | 12,972.50                                                               |
| 4                                                                       | Future Generali India Insurance Co. Ltd.                                | 14,222                                                                  | 5,964                                                                   |
| 5                                                                       | Go Digit General Insurance Ltd.                                         | 19,844.13                                                               | 3,836.93                                                                |
| 6                                                                       | HDFC ERGO General Insurance Co. Ltd.                                    | 46,862.69                                                               | 24,806.41                                                               |
| 7                                                                       | ICICI Lombard General Insurance Co. Ltd.                                | 1,13,380.14                                                             | 88,301.20                                                               |
| 8                                                                       | IFFCO Tokio General Insurance Co. Ltd.                                  | 14,065.96                                                               | 49,273.54                                                               |
| 9                                                                       | Kotak Mahindra General Insurance Co. Ltd.                               | 2,245.46                                                                | 10,043.02                                                               |
| 10                                                                      | Liberty General Insurance Ltd.                                          | 669                                                                     | 3,361                                                                   |
| 11                                                                      | Magma HDI General Insurance Co. Ltd.                                    | 6,887.45                                                                | 6,227.31                                                                |
| 12                                                                      | Navi General Insurance Limited                                          | 256.2                                                                   | 2,142.22                                                                |
| 13                                                                      | Raheja QBE General Insurance Co. Ltd.                                   | 227.42                                                                  | 603.62                                                                  |
| 14                                                                      | Reliance General Insurance Co. Ltd.                                     | 23,734.01                                                               | 34,802.67                                                               |
| 15                                                                      | Royal Sundaram General Insurance Co. Ltd.                               | 4,555.76                                                                | 3,516.25                                                                |
| 16                                                                      | SBI General Insurance Co. Ltd.                                          | 69,083.08                                                               | 33,525.88                                                               |
| 17                                                                      | Shriram General Insurance Co. Ltd.                                      | 6.91                                                                    | 29.51                                                                   |
| 18                                                                      | Tata AIG General Insurance Co. Ltd.                                     | 17,045.14                                                               | 31,948.91                                                               |
| 19                                                                      | Universal Sompo General Insurance Co. Ltd.                              | 13,932                                                                  | 2,598                                                                   |
| 20                                                                      | Zuno General Insurance Co. Ltd.$                                        | 4,692.78                                                                | 3,253.62                                                                |
|                                                                         | Private Sector Insurers Total                                           | 4,33,329.21                                                             | 3,67,087.16                                                             |
| Stand-alone Health Insurers                                             | Stand-alone Health Insurers                                             | Stand-alone Health Insurers                                             | Stand-alone Health Insurers                                             |
| 21                                                                      | Aditya Birla Health insurance Co. Ltd.                                  | 30,025.49                                                               | 29,294.68                                                               |
| 22                                                                      | Care Health Insurance Ltd.                                              | 61,641.48                                                               | 50,935.75                                                               |
| 23                                                                      | ManipalCigna Health Insurance Co. Ltd.                                  | 37,628.06                                                               | 32,171.94                                                               |
| 24                                                                      | Niva Bupa Health Insurance Co. Ltd.                                     | 49,318.58                                                               | 40,941.01                                                               |
| 25                                                                      | Reliance Health Insurance Ltd.@                                         | 0.2                                                                     | 1.33                                                                    |
| 26                                                                      | Star Health& Allied Insurance Co. Ltd.                                  | 2,77,485                                                                | 1,65,979                                                                |
| Stand-alone Health                                                      | Insurers Total                                                          | 4,56,098.98                                                             | 3,19,323.58                                                             |

| Public Sector Insurers   | Public Sector Insurers           | Public Sector Insurers   | Public Sector Insurers   |
|--------------------------|----------------------------------|--------------------------|--------------------------|
| 27                       | United India Insurance Co. Ltd.  | 1,34,214.57              | 61,346.15                |
| 28                       | The New India Assurance Co. Ltd. | 4,86,399.04              | 2,17,405.42              |
| 29                       | The Oriental Insurance Co. Ltd.  | 0                        | 63,344.79                |
| 30                       | National Insurance Co. Ltd.      | 0                        | 65,210.65                |
|                          | Public Sector Insurers Total     | 6,20,613.61              | 4,07,307.01              |
|                          | Grand Total                      | 15,10,041.80             | 10,93,717.75             |

(Source: Annual Report data of IRDAI 2023-24.)

## Reply to Lok Sabha Unstarred Question No. 93 for answer on  03.02.2025

## STATE-WISE  HEALTH  INSURANCE  PREMIUM  (EXCLUDING  TRAVEL  AND  PERSONAL ACCIDENT BUSINESS)

| S.No.   | State/ UT                          | Gross Premium (₹ Crores)   | Gross Premium (₹ Crores)   | Gross Premium (₹ Crores)   |
|---------|------------------------------------|----------------------------|----------------------------|----------------------------|
|         |                                    | 2021-22                    | 2022-23                    | 2023-24                    |
| 1       | Andhra Pradesh                     | 1,038                      | 1,313                      | 1,645                      |
| 2       | Arunachal Pradesh                  | 8                          | 10                         | 11                         |
| 3       | Assam                              | 314                        | 445                        | 506                        |
| 4       | Bihar                              | 426                        | 622                        | 749                        |
| 5       | Chhattisgarh                       | 264                        | 341                        | 409                        |
| 6       | Goa                                | 127                        | 136                        | 201                        |
| 7       | Gujarat                            | 5,233                      | 6,359                      | 8,458                      |
| 8       | Haryana                            | 3,348                      | 4,263                      | 5,644                      |
| 9       | Himachal Pradesh                   | 66                         | 91                         | 106                        |
| 10      | Jharkhand                          | 391                        | 1,138                      | 957                        |
| 11      | Karnataka                          | 7,785                      | 9,783                      | 12,017                     |
| 12      | Kerala                             | 2,066                      | 3,032                      | 3,711                      |
| 13      | Madhya Pradesh                     | 1,195                      | 1,477                      | 1,681                      |
| 14      | Maharashtra                        | 23,301                     | 26,349                     | 31,258                     |
| 15      | Manipur                            | 12                         | 20                         | 15                         |
| 16      | Meghalaya                          | 16                         | 101                        | 54                         |
| 17      | Mizoram                            | 127                        | 81                         | 191                        |
| 18      | Nagaland                           | 20                         | 44                         | 28                         |
| 19      | Orissa                             | 598                        | 761                        | 928                        |
| 20      | Punjab                             | 1,149                      | 1,297                      | 1,490                      |
| 21      | Rajasthan                          | 2,365                      | 3,548                      | 4,313                      |
| 22      | Sikkim                             | 12                         | 14                         | 19                         |
| 23      | Tamil Nadu                         | 6,851                      | 8,809                      | 9,738                      |
| 24      | Telangana                          | 3,683                      | 4,787                      | 5,873                      |
| 25      | Tripura                            | 28                         | 42                         | 48                         |
| 26      | Uttar Pradesh                      | 3,180                      | 4,055                      | 4,936                      |
| 27      | Uttarakhand                        | 275                        | 347                        | 404                        |
| 28      | West Bengal                        | 3,533                      | 3,770                      | 4,175                      |
| 29      | Andaman &Nicobar                   | 3                          | 4                          | 4                          |
| 30      | Chandigarh                         | 346                        | 198                        | 233                        |
| 31      | Dadra &Nagar Haveli and Daman &Diu | 38                         | 45                         | 56                         |
| 32      | Delhi                              | 4,890                      | 5,752                      | 7,073                      |
| 33      | Jammu &Kashmir                     | 311                        | 394                        | 674                        |
| 34      | Ladakh                             | 1                          | 1                          | 1                          |
| 35      | Lakshadweep                        | 3                          | 1                          | 2                          |
| 36      | Puducherry                         | 49                         | 60                         | 71                         |
|         | Total                              | 73,052                     | 89,492                     | 1,07,681                   |

(Source: Annual Report data of IRDAI, 2023-24.)

## Reply to Lok Sabha Unstarred Question No. 93 for answer on  03.02.2025

- (I) Amount of claims paid by insurance companies for every 10000 Rupees of premium collected in FY 2023-24 is as under:-
- (II)  Number of claims paid by insurance companies for every 10000 claims received in FY 2023-24 is as under:-

| Particulars                                 | Public Sector insurers   |   Private Sector General insurers |   Standalone Health Insurers (SAHI) |
|---------------------------------------------|--------------------------|-----------------------------------|-------------------------------------|
| Claims paid (Rs)                            | 10,122                   |                              7077 |                                5463 |
| Claims carried forward to next year (in Rs) | 1029                     |                               662 |                                 336 |

(Source: Annual Report data of IRDAI 2023-24.)

| Particulars                                   |   Public Sector insurers |   Private Sector General insurers |   Standalone Health Insurers (SAHI) |
|-----------------------------------------------|--------------------------|-----------------------------------|-------------------------------------|
| Number of Claims paid                         |                     7984 |                              8639 |                                8635 |
| Number of Claims repudiated                   |                     1262 |                               885 |                                 921 |
| Number of Claims carried forward to next year |                      754 |                               476 |                                 444 |

(Source: Annual Report data of IRDAI 2023-24.)