The steps can vary depending on the type of insurance and the nature of the claim. In some cases, hospitals, third-party administrators (TPAs), surveyors, repairers or lenders may also be involved.
Narendra Bharindwal, President of the Insurance Brokers Association of India (IBAI), apex body and trade association for all licensed insurance and reinsurance brokers in the country, said the post-approval process generally involves confirming the payable amount, completing any pending documentation, verifying policyholder or beneficiary details and bank account information, and then processing the payment.
Why can an approved claim still be delayed?
Documentation or verification issues can affect the final settlement.
Bharindwal said inconsistencies in bank or KYC details, differences in names or account information, pending discharge or consent documents and beneficiary-related verification can lead to delays.
There can also be additional coordination depending on the claim. Hospitals, TPAs, surveyors and repairers may need to provide information or complete their part of the process before the payment can be released.
Ankita Srivastava, General Manager – Growth & Strategy at THIP Insure (The Healthy Indian Project), a digital insurance broking platform, said the final payable amount may also involve adjustments for deductibles, co-payments and policy limits. In reimbursement claims, differences between submitted invoices and expenses admissible under the policy can lead to requests for further information.
Large general insurance claims can involve another layer of verification when lenders are involved.
Chandan Grover, National Head – Claims Advocacy at Prudent Insurance Brokers, an Indian full-service insurance broking and risk advisory firm, said policies covering large financed assets may contain an agreed bank clause. In such cases, insurers may require a no-objection certificate from the relevant lender before settling the claim.
Grover said delays can arise when multiple lenders are involved and the policy does not clearly identify the lead banker. A change in lenders during the policy period that has not been updated with the insurer can also require additional documentation.
KYC requirements can similarly affect the disbursement timeline if the policyholder takes time to provide the required documents, he added.
How does this work in health insurance?
Health insurance claims broadly follow two routes, cashless and reimbursement.
In a cashless claim, the insurer settles the approved amount directly with the hospital. In a reimbursement claim, the policyholder pays the hospital and subsequently submits documents to the insurer for assessment.
Vikram Roy, Head – Health Claims at Go Digit General Insurance, an Indian digital-first, non-life insurance company, said the cashless process can begin before hospitalisation, with the hospital coordinating with the insurer or TPA for pre-authorisation.
Once the claim is registered, the insurer reviews the documents and assesses the treatment against the policy’s coverage, waiting periods, exclusions and other conditions. If approved, the admissible amount is calculated after accounting for deductibles, co-payments and non-payable expenses.
For reimbursement claims, Roy said documents can include the final hospital bill, discharge summary, investigation reports, prescriptions, payment receipts, identity proof and bank details.
Can policyholders reduce documentation-related delays?
All four experts point to the importance of complete and consistent documentation.
Srivastava said claim intimation should be made within the stipulated timelines and the documents submitted should be accurate and consistent. Bharindwal also advised policyholders to retain copies of submitted documents and the claim reference number for tracking.
For large claims, Grover said legible, self-certified copies may be required, while loss adjusters may verify the authenticity of documents.
Digital processes are changing how these steps are completed. Online claim intimation, electronic document submission, e-KYC, automated verification, claim tracking and electronic payments are reducing reliance on physical paperwork.
Bharindwal said greater digitisation and straight-through processing could reduce friction in the claims process, while Grover noted that the shift from physical payment instruments to NEFT and RTGS has shortened the time taken for payments to reach bank accounts.
However, digitisation does not eliminate documentation requirements. As Srivastava noted, accurate and complete information remains important even when the claim process is entirely digital.
For health insurance, Roy said insurers are required to communicate cashless pre-authorisation decisions within one hour, provide discharge authorisation within three hours of the hospital’s request and settle eligible reimbursement claims within 15 days of receiving all necessary documents.
