Hidden Clauses in Insurance Policies That Could Void Your Claim
Insurance companies include fine-print clauses that can void your entire claim. Know what to look for before buying a policy.
Insurance policies are dense documents filled with fine print. Here are the clauses that could trip you up when you need coverage most.
Pre-Existing Disease Exclusions
IRDAI mandates that pre-existing conditions must be covered after a maximum waiting period of 48 months. Some policies try to extend this or define "pre-existing" so broadly that almost anything qualifies.
Sub-Limits and Room Rent Caps
A policy might advertise ₹10 lakh coverage but include a room rent sub-limit of ₹5,000/day. In metro cities, this means you'll pay the difference out of pocket. Always check for sub-limits.
Proportionate Deduction
If you exceed the room rent limit, some policies apply proportionate deduction to your entire claim — not just the room rent. This can reduce your payout significantly.
Co-Payment Clauses
A co-payment clause means you bear a percentage of every claim. While IRDAI allows this, it should be clearly disclosed. A 20% co-pay on a ₹5 lakh claim means ₹1 lakh from your pocket.
Cooling-Off Period
IRDAI mandates a 15-day free-look period for life insurance and 30 days for health insurance. Use this to review the policy thoroughly. If anything doesn't match what was promised, return the policy for a full refund.
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