Introduction
Getting an insurance claim rejected can be frustrating—especially when you paid premiums regularly and expected financial support during a difficult time.
If you’re facing rejected insurance claims, you’re not alone. A large number of health, life, and motor insurance claims are denied every year due to avoidable mistakes. The good news is that many rejected claims can be appealed and reversed if handled correctly.
In this article, we’ll explain the 5 most common reasons insurance claims get rejected and show you how to appeal them step by step in simple, practical language.
Why Insurance Claims Get Rejected
Insurance companies reject claims mainly due to:
- Policy conditions not being met
- Incorrect or incomplete information
- Documentation issues
- Missed deadlines
Most rejections are procedural, not intentional fraud.
Understanding the reasons helps you avoid future problems and fight unfair rejections.
1. Non-Disclosure of Important Information
What Goes Wrong
Many policyholders fail to disclose:
- Pre-existing diseases
- Smoking or drinking habits
- Previous insurance history
Even unintentional non-disclosure can lead to claim rejection.
Example
A health insurance claim gets rejected because a past medical condition was not mentioned while buying the policy.
How to Appeal
- Check if the non-disclosure was material and intentional
- Provide medical records proving the condition was unknown
- Submit a written clarification to the insurer
Tip: Honesty at the proposal stage is the best prevention.
2. Policy Lapse Due to Missed Premiums
What Goes Wrong
If premiums are not paid on time, the policy may lapse—even if you missed just one installment.
Example
A life insurance claim is rejected because the policy was inactive at the time of death.
How to Appeal
- Check if the policy was within the grace period
- Submit premium payment proof
- Request policy revival documents
If revival rules were followed incorrectly, insurers may reconsider.
3. Claim Filed After Deadline
What Goes Wrong
Insurance policies have strict timelines for:
- Intimation of claim
- Submission of documents
Late submission is a common reason for rejection.
Example
Motor insurance claim denied because accident was reported after the allowed period.
How to Appeal
- Explain the reason for delay in writing
- Provide evidence (hospitalization, emergency, travel)
- Request condonation of delay
Courts often favor genuine cases with valid reasons.
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4. Incomplete or Incorrect Documents
What Goes Wrong
Missing or incorrect documents such as:
- Hospital bills
- Discharge summary
- Death certificate
- FIR (for motor claims)
Example
Health claim rejected due to mismatch in hospital bills and diagnosis.
How to Appeal
- Ask insurer for a written list of missing documents
- Submit corrected or additional documents
- Re-file the claim within the appeal window
Always keep copies of every document you submit.
5. Claim Not Covered Under Policy Terms
What Goes Wrong
Policyholders often assume coverage without reading exclusions.
Common exclusions include:
- Waiting period conditions
- Cosmetic procedures
- Self-inflicted injuries
- Certain critical illnesses in early years
Example
Health insurance claim rejected due to waiting period not completed.
How to Appeal
- Review policy wording carefully
- Check if exclusion was properly explained
- If terms were mis-sold, raise a grievance
Mis-selling can be a strong ground for appeal.
How to Appeal a Rejected Insurance Claim (Step-by-Step)
Step 1: Ask for Written Rejection Reason
Always demand a written explanation from the insurer.
Step 2: Review Policy Document
Check:
- Coverage clauses
- Exclusions
- Claim timelines
Step 3: Submit a Formal Appeal
Include:
- Appeal letter
- Supporting documents
- Clarification for rejection reason
Step 4: Escalate to Grievance Cell
If unresolved:
- Contact insurer’s grievance department
- Keep acknowledgment receipts
Step 5: Approach Insurance Ombudsman
If the insurer still refuses:
- File complaint with Insurance Ombudsman
- No legal cost involved
- Faster resolution
When Should You Go to the Insurance Ombudsman?
You can approach the Ombudsman if:
- Claim amount is within the prescribed limit
- Insurer doesn’t respond within 30 days
- You are not satisfied with insurer’s reply
The Ombudsman’s decision is binding on insurers.
Tips to Avoid Claim Rejection in Future
- Read policy document thoroughly
- Disclose all facts honestly
- Keep documents organized
- Inform insurer immediately after incident
- Track claim status regularly
A little awareness can save months of stress.
FAQs – Rejected Insurance Claims
Can a rejected insurance claim be appealed?
Yes, most insurance claims can be appealed with proper documentation.
How long do I have to appeal an insurance claim?
Usually 30–60 days, depending on the insurer and policy terms.
Is Insurance Ombudsman free?
Yes, filing a complaint with the Ombudsman is completely free.
Can claims be rejected after approval?
Yes, if discrepancies or fraud are found during verification.
Do courts favor policyholders?
Courts often support genuine policyholders when insurers act unfairly.
Conclusion
A rejected insurance claim does not mean the end of the road. In many cases, rejections happen due to simple mistakes that can be corrected with proper appeal and documentation.
Understanding the common reasons for claim rejection and knowing how to appeal them effectively can help you recover the benefits you deserve.
