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Home / Money / Personal Finance /  Will insurers cover hospitalization if corporate health plan renewal is delayed?
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My corporate health policy expired on 1 April and the hospital where I underwent a surgery charged me more since I paid in cash. The policy has since been renewed by my employer but I will only get partial reimbursement. 

If it is not the fault of the policyholder, why should the insured bear additional costs? Why can’t insurers consider these cases as exceptional and ensure full reimbursement?

— Name withheld on request

 

I am assuming your case is of an issue of hospital discount. Insurers have a preferred relationship with some hospitals in their network. Through this arrangement, they arrange discounted package rates for frequent treatments. This helps them control the claims costs.

Insurers do consider exceptional requests for cashless treatment. Even if the policy is under renewal, you can apply for this. Cashless treatment will apply until discharge from the hospital. Your hospital bill would get revised as per the tariff agreed between the insurer and hospital. The hospital then refunds the advance amount paid by you, and settles the bill directly with the insurer. However, for this to happen, it is critical that your employer should have made payment for the policy before your actual hospitalization date.

Some group policies have a disease-wise sub-limit. Employers get this incorporated to control costs. If the limit of 50,000 is due to such a condition, then that is the maximum amount reimbursable under the policy for that ailment.

 

I surrendered my insurance policy in October 2018 on the advice of my relationship manager who asked me to opt for a fresh ULIP policy. I had visited the insurer’s office and took action for closure of the old policy and also starting a new one.  However, earlier this month, I received a legal notice from a Delhi-based law firm stating that I had received an excess payout of 2,28,235 on surrendering the policy and that I am liable to return the said amount.

How should I  respond to this notice?  It is now been 23 months since I surrendered the old policy and took a new policy from the same firm. 

— Name withheld on request

 

It would be highly unusual for a life insurer to issue you a notice to recover excess payments made. Life insurers do very detailed calculations before redeeming any surrender value. Any such calculation passes through several internal checks and balances. So, it is highly unlikely that the insurer would have paid you an excess amount over and above your eligibility. 

You should protect yourself from two possible scenarios. First, the said notice is a fraudulent one. You should find out about the whereabouts of the lawyer. You could also write an email to the customer care of the insurer to report this notice, and check for authenticity. Second, if the notice is genuine, you must check if there was a case involving misrepresentation by one of the executives of the insurer. You should check the acknowledgement note, you would have received at the time of surrender of the plan. If your papers are authentic, and you followed the due process, then insurer would have limited case against you. The fact that you had invested in another of the same insurer’s plan has no bearing on the case.

Abhishek Bondia is principal officer and managing director, SecureNow.in.

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