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Why are insurance claims sometimes delayed? Here are the five reasons

Published on Sept 16, 2020. EST READ TIME: 5 MIN   

Many-a-times it has been observed that the claim settlement process  may take a long time than expected. Why does this happen? This article will help to give insight on various reasons that can cause inordinate delays in the claim settlement process.

Health insurance  is a critical and necessary investment for you and your family’s health. With the current pandemic of Covid-19,which has significantly changed the global parameters of healthcare and the cost of treatments, it is wise to make sure that both you and your loved ones are covered. It is the insurer’s responsibility to cover you for any medical emergencies and ensure that claims are settled in a hassle-free manner. However, several reasons can delay the claim settlement process.

Here is a list of 5 of them

  • Not filing the claim in time One of the chief reasons, the claim settlement process is delayed, is that the policyholders are often late in submitting their claims. Every policy has a clearly stated deadline within which to file the claim after the medical procedure or emergency. While these may vary between health insurance providers, it is usually a generous 7 to 14 working days. So, if you as the policyholder have been tardy in filing your claim, you can expect a delay in the claim settlement process, as the investigation on the end of your health insurance provider also takes a certain amount of time.

  • Losing or not keeping your insurance papers in one place Health insurance papers are of vital importance and should be kept safe and secure. Always keep a backup of your insurance papers on your computer or in the cloud. If the insurance holder has lost or can’t find the policy documents in time, then obviously there will be a delay in the claim settlement process.

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  • Not following the right pre-authorisationclaims process

    In the case of pre-planned medical procedures, it is advisable to apply for cashless treatments. And for this, pre-authorisation is the first thing you should do. Some steps that need to be followed, in order, for this process to begin such as:

    • Procuring the pre-authorisation form from the health insurance company or hospital TPA desk

    • Filling the accurate patient (insurance holder) details and policy details

    • The presiding doctor needs to fill in the details and particulars about the procedure

    • The form has to be sent to the hospital’s billing department and an estimate cost of the procedure and other relevant costs needs to be raised

    • The pre-authorisation form must then be sent to the health insurance provider with other relevant documents, duly attested and filled out

    • The health insurance provider will then review the documents and pending successful completion of this process, pre-approve / pre-authorise the claim

    Pre-authorisation means that your insurance provider has, in principle, sanctioned a particular amount, that they will pay (the pre-authorised amount is subject to receipt of the final invoice from the hospital). It is important to note that pre-authorisation is not a guarantee that the insurer will settleyour bill. The company may ask (in some cases) the hospital for additional bills, medical receipts, test results and other documents.

    Receipt of these documents, any error in the delineated processes (refer to the bulleted points) or deviation from said processes can cause a delay in the claim settlement process, or even cashless treatments. In case of emergency and unplanned procedures or hospitalisation, the hospital may ask you to deposit a certain sum of money. This is often reimbursed later. This happens because the need is sudden and unexpected, and you didn’t have time to go through the pre-authorisation process.

  • Exchange of information/ documents between the hospital and Insurance Company

  • Even though pre-authorizationis a clearly defined procedure, sometimes there could be a delay caused by settlement issues between the hospital and the health insurance company. These issues could cause a delay in the claim settlement process. Here’s a short summary of what could go wrong.

    • The hospital may delay in sending the health insurance company the discharge summary

    • The hospital may delay sending the final bill to the health insurance company

    • The faster the final bill arrives, the faster it can be investigated and the claims settlement process kicked off

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  • Ancillary factors on the claimant’s end

At times, minor issues on the part of the policyholder may delay the cashless treatments or claims settlement process. These could include:

  • Failure to inquire about the date of discharge

  • Failure to note the exact time of discharge

  • Failure to notify the TPA (Third Party Administrator) to prepare relevant documents and share them with the health insurance provider

  • Failure to follow up with the TPA and the insurance provider about the claim


Most of the reasons why the claims settlement process is often delayed are relatively minor. Knowledge of these can help you avoid such situations and ensure that your health insurance is settled in a timely and organized manner.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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