Lessons from Real Experience

Health insurance is bought with hope. Hope that when something goes wrong, financial stress will not add to emotional pain.

But in India, many families truly understand health insurance only when a claim gets rejected. That moment becomes a harsh reality check, and it often feels like the system is against you.

I have seen this personally. I have seen families who trusted the system, paid premiums on time, and still faced rejection when they needed support the most. Most claim rejections do not happen because the policy is fake or the insurance company is cheating. They happen because of small mistakes, unclear communication, or lack of understanding at the time of buying the policy or declaring medical information. Sometimes, the policyholder thinks they have done everything correctly, only to realise later that one small detail was missed.

From my own experience and from what I have seen around me, one truth stands out clearly.
In health insurance, clarity and honesty matter more than anything else.

A Real Story That Changed My Understanding

One of my close friends bought a health insurance policy for his father. He believed he had done everything right.

He chose a strong policy with a one crore sum insured. The premium was high, but his intention was simple. He wanted peace of mind and financial security for his father, who was around sixty years old. Like many families, he believed that a higher sum insured automatically meant better protection and fewer problems.

One day, his father was hospitalised due to a severe asthma attack. The hospital was cashless, and initially everything seemed smooth. The family felt relieved that they had planned ahead and would not face financial pressure during a medical emergency. It was a moment when everyone felt that the decision was correct and the plan was working.

But during claim verification, the insurance company started checking medical history in detail. They did not just look at the current hospital bills. They looked deeper into the past, which many people do not expect.

In the proposal form, three pre existing conditions were declared based on the doctor’s records.
Blood pressure
Asthma
Diabetes

However, cholesterol was not mentioned.

My friend genuinely believed cholesterol was part of blood pressure and did not think it required separate disclosure. There was no intention to hide anything. It was simply a lack of medical understanding, something very common among policyholders. Many people treat medical terms as similar or connected, without realising that insurance companies see them separately.

During verification, the insurance company checked prescription history and found that cholesterol medicines were being taken even before the policy started.

That single detail changed everything.

The insurer treated this as non disclosure of a chronic condition. Since cholesterol medication existed before policy inception and was not declared, the claim was rejected completely.

Asthma was declared.
Blood pressure was declared.
Diabetes was declared.

But one missing condition destroyed the entire claim.

For my friend, it was heartbreaking. He had paid a high premium, chosen a good policy, trusted the system, and still lost the claim when his family needed it the most. He did not join the hospital with a cholesterol-related issue, but the claim was rejected because the insurer found cholesterol medication in the medical history before the policy started. The feeling of helplessness was not just financial; it was emotional. It felt like the trust he had placed in the system was broken. It felt like the trust he had placed in the system was broken.

That incident taught me a powerful lesson.
In health insurance, assumptions are dangerous.

I still remember the day he told me about the rejection. He was quiet, not angry. The silence itself was painful. It made me realise how easily something can go wrong, even with good intentions. That moment stayed with me for a long time.

Hiding or Ignoring Pre Existing Diseases

This is one of the most common health insurance mistakes Indian families make.

Many people believe it is just BP or sugar, it is under control, it happened long ago, or disclosing everything will increase the premium. Some people even think that minor issues are not important enough to mention.

But insurance companies do not work on emotions or assumptions. They work strictly on declarations and documents. What is written in the proposal form becomes the basis of the contract.

If a condition existed before buying the policy, even if it feels minor or well managed, it must be disclosed. Even regular tablets matter.

During claims, insurers check hospital records, doctor notes, prescription history, and diagnostic reports. Any mismatch between declaration and actual medical history can lead to claim rejection, even years later. This is not only a policy issue; it is a legal issue.

Giving Wrong Information Due to Lack of Knowledge

Not all wrong information is intentional.

Many people do not fully understand medical terms, the difference between conditions, or what qualifies as treatment or diagnosis. Often, proposal forms are filled quickly, sometimes by agents, and policyholders sign without complete understanding. This is especially common when the family is busy or the policy is purchased under stress.

But legally, responsibility always lies with the policyholder, not the agent. The agent may guide you, but the final declaration is yours.

From experience, I learned one simple rule.
If you do not understand a question in the proposal form, stop and clarify. Never guess.

Lack of Clarity Is More Dangerous Than Low Coverage

Most people focus on low premiums, high sum insured, or brand names. They ignore waiting periods, disease specific exclusions, sub limits, and co payment clauses. These details may seem small, but they determine whether a claim will be accepted or rejected.

Health insurance policies are legal contracts. When a claim is raised, intentions and emotions do not matter. Only what is written in the policy document matters.

Clarity saves claims. Confusion destroys them.

How Insurance Companies Actually Work

Insurance companies are businesses that manage risk. They collect premiums and pay claims strictly according to policy terms.

During claims, they carefully examine proposal forms, medical records, and links between past and current illnesses. If they find any undisclosed condition connected to the treatment, claims can be rejected or reduced.

This is not personal. This is how the health insurance system works. The system is designed to protect the insurer from fraud and incorrect declarations. It is not designed to punish honest people, but it does not differentiate between intentional or unintentional errors.

Cashless Does Not Mean Guaranteed

Many people assume that cashless hospitalisation means guaranteed claim approval.

Cashless only means the hospital has a tie up with the insurer. Final approval still depends on policy terms, medical justification, and past disclosures.

Claims can be rejected even after discharge if discrepancies are found later. Cashless only helps with immediate cash flow, not with claim approval.

Emotional Decisions Instead of Informed Decisions

Many people buy health insurance in panic, after a medical emergency, or out of fear. This leads to rushed decisions, blind trust in agents, and skipped reading of policy documents.

Health insurance requires calm, informed thinking, not emotional urgency. The decision should be based on understanding the policy, not only on price or brand name.

Final Thoughts From Experience

The biggest lesson I learned is simple.

In health insurance, honesty and clarity are more powerful than high coverage or low premium.

Do not assume medical meanings.
Do not hide information, even unknowingly.
Do not rush through forms.

Because when health fails, insurance is not just money.
It is security, dignity, and peace of mind.

And peace of mind should never be built on confusion.

Written by Badri | MoneyScope360
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