Multiple mediclaim policies settlement

Many of us or may have multiple health insurance policies. Most of the salaried persons anyway have a group mediclaim from their employer. Someone might have bought a health insurance cover from PSU insurer long back and now took a higher cover from a private insurer.

Let's take an example here: I have a health insurance cover from company A of Rs. 2 lakhs and from company B of Rs. 3 lakhs.

If my claim amount is less than Rs. 2 lakhs - I can then choose any insurer (A or B) to settle the claim; if  claim amount is more than Rs. 2 lakhs but less than Rs. 3 lakhs - I can only approach company B for settling the claim.

But if my claim amount is more than 3 lakhs (say 4 lakhs) - then I have to approach both the company A and B.

In such a scenario 'contribution clause' may come into effect. Out of my total cover of 5 lakhs - company A's contribution is 40% ((2/5)×100) and company B's contribution is 60% ((3/5)×100). So out of my total claim Rs. 1.60 lakhs (40% × 4 lakhs) will be reimbursed by company A and Rs. 2.40 lakhs (60% × 4 lakhs) will be reimbursed by company B. Some companies may also decide to settle the maximum claim amount that it can within its limit without resorting to 'contribution clause'.

But in such a case you cannot send the original bills and original discharge certificate to both the companies. So before sending the original documents to first company - take photocopies of everything and also attest. Once the claim is settled by the first company - take the 'settlement certificate' from them and if possible also ask from them for a declaration that they have all the original documents with them. Now approach the second company with duly filled claim form, attested photocopies and 'settlement certificate' received from the first company.

While taking a new policy you must declare details of your existing policies, if any. Though in most of the cases group mediclaim policy details are not asked but still read the instructions in proposal form carefully. Preferably you should have one large cover from a single insurer rather than having several small covers from multiple insurers.

If you have any experience in helping your clients settling multiple claims - please share.