While policyholders should keep Irdai’s cautionary note in mind, a pertinent question to ask in this context is: why did the need for such advisers arise in the first place? Experts say that lengthy claims processes can sometimes be a problem, and harassed policyholders then seek assistance from other entities.
The claims process
“The claim process is often not smooth. There are delays and denial of claims without proper reasoning, which wear down claimants. Agents often mislead consumers while taking insurance, resulting in denial of claims," said S. Saroja, director, consumer advisory and outreach, Citizen Consumer and Civic Action Group, a Chennai-based citizens’ group.
While making a claim against a health policy, the policyholder, typically, has to deal with multiple entities—doctors, the hospital, the third-party administrator (TPA) and the insurance company. There can be a problem vis-a-vis any of the entities. “For health claims, one has to deal with the TPA. Delay in claim settlement due to reasons such as incomplete paperwork, excessive claim amount and non-disclosure could cause delays and other problems. Sometimes, TPAs even claim that the insurance company has not released the funds," said Lovaii Navlakhi, managing director and chief executive officer, International Money Matters Pvt. Ltd, a financial planning firm.
While experts agree that things are improving and processes are getting better, some issues still need to be addressed. “Health insurance claim logistics and communication have improved significantly as insurance companies have streamlined the process with email, phone and app interface," said Rohit Shah, founder and chief executive officer, Getting You Rich, a financial planning firm. “The settlement continues to be a challenge with disputed rejections and grey-area claims. Sometimes, one gets a feeling that the processes are designed to pay minimum claim, if at all. Health insurers in India have a very long way to go before they are seen as credible on whom clients rely," added Shah.
Do you need claim advisers?
Though Irdai’s advisory was general in nature, it mentioned SureClaim, which operates as a claims service advisory for health policies. “Since we have a very prominent presence in Bengaluru and we participate in events, some Irdai functionary would have observed our business," said Anuj Jindal, co-founder, SureClaim.
Explaining the company’s profile and what it does, he said, “We are an insurance claim advisory platform and there are no guidelines for regulation for a new-age insurtech platform like ours. We help existing policyholders—receive inputs regarding their insurance eligibility, get their claims prepared by experts and get professional opinion on rejected claims," added Jindal. SureClaim charges a consulting fee of at least ₹3,000 for assistance such as putting together all supporting documents, checking the fairness of the settlement and so on.
Other platforms that are providing similar claim advisory services include BimaClaim. While this may be a new concept in India, claim advisers, advocates and consultants are valid job profiles in developed countries.
However, financial planners believe that the claim process needs to improve and that the authority should ensure that a transparent system is followed by all insurers. “A policyholder is entitled to receive money on a legitimate claim. Ideally, he should not be required to spend money to claim insurance for which he has already paid premiums. The real problem is not whether a claim adviser is needed or not. It is that regulatory and judiciary governance around health insurance is very weak," said Shah.
Policyholders may be tempted to seek help in case their claim is rejected, but experts differ. “I don’t think that the solution is to have claim advisers, or middlemen. This will create room for various other issues like corruption. Also, if they (claim advisers) are not authorized, it can be very risky," said Saroja.
Since these entities are not regulated, there may be ethical issues to deal as well. “If the claim adviser, who is a third party and not related to the insurance industry, gives wrong advice such as changing the papers or diagnosis, or masking a chronic condition, it won’t be ethical," said Nayan C. Shah, managing director, Paramount Health Services (TPA) Pvt. Ltd.
While it is better to stick to the established process of claims, genuine assistance is always welcome. “When you or your family member is admitted in a hospital, the last thing on your mind would be trying and understanding or tackling the claims process. In such situations, genuine assistance is certainly welcome," said Deepak Yohannan, founder and CEO, Myinsuranceclub.com, an insurance web aggregator. However, it’s best to take the help of your insurance company, TPA or the intermediary through which you bought the policy, added Yohannan.
To smoothen your claims journey, you have to be careful from the time of buying a policy itself. Go through the terms and conditions of a policy and don’t hide any information, especially about your medical history. Before making a claim, keep your policy agent and insurer in the loop. Also ensure that you maintain the documents required for making a claim