Don’t want your health insurance claim to be rejected? Know the disclosures you need to make
28 Dec 2018
The insurance company understands the nature of risk and calculates the premium to cover that risk at the time of underwriting a policy
While buying a health insurance policy, many health-related disclosures are sought by the insurance company. It is because the disclosure of pre-existing diseases is mandatory while buying a health insurance policy. The insurance company determines a policy premium based on the information provided by the policyholder assuming that whatever disclosure has been made is correct. The insurance company understands the nature of risk and calculates the premium to cover that risk at the time of underwriting a policy.
However, in case you don’t disclose your medical condition accurately, in the future during a claim there is a high chance of it getting rejected on grounds of non-disclosure. Hence, it is important that you make full disclosures, especially about your health, not just about the present but also the past conditions.
Experts suggest, if policyholders make the disclosures upfront during the process of underwriting, then generally there is no conflict or questions raised in the future on grounds of non-disclosure. For instance, most insurance companies do not ask for a medical test before the age of 45, and the policy is given in good faith. However, if you don’t disclose your proper medical conditions or pre-existing diseases while buying the policy, there is a very high chance of your claim being rejected in the future. Therefore, it is important to understand and properly fill up the policy form and make correct disclosures.
In case you are diagnosed with a medical problem two or three years down the line after buying the insurance policy, then it is not necessary to disclose the condition to your health insurance provider even during renewal. Normally the insurer includes this in the existing policy, given that you renew the policy every year without missing any payment. According to experts, if you were unaware of any condition while buying the policy and later you develop a medical condition, your health insurance claim will not be rejected.
Industry experts suggest, as a good practice, the policyholder should disclose if there are any changes in their health conditions during renewal. Most insurers now give guidance and help the policyholders with their conditions, by providing complementary wellness programs and expertise to help them recover. The premium price of a policyholder is not effected due to this. For an individual health insurance policy premium can only increase if the policyholder wants to increase their existing sum insured or with age.
In few years after buying a policy, if you are diagnosed with any new medical condition, and you want to underwrite or increase the current sum insured, the insurer will consider this as pre-existing and the new premium will accordingly increase. However, this might not effect your initial health insurance cover. Some insurers can even decline to increase the sum insured or might even exclude existing health conditions.
For instance, if you are a smoker and you don’t declare that to your insurer while buying the policy, and later it gets revealed that you have already been a smoker at the time of taking the policy, the insurance company has the right to deny your claim. However, if a non-smoker, who has bought a health insurance cover, starts smoking in later years, his health insurance premium does not get affected due to this.
(Disclaimer: These are the author’s views. Readers are advised to consult their financial advisor before buying any plan)