Insurance Claim Rejected? Steps to Insurer, IRDAI, Ombudsman and Consumer Forum

If your insurance claim is rejected, first file a written grievance with the insurer. Under IRDAI’s 2024 master circular, the insurer must acknowledge it immediately and resolve it within 14 days, giving reasons if it says no. If that fails, you can escalate on IRDAI’s Bima Bharosa portal and then go to the Insurance Ombudsman. The Ombudsman is free and handles claims up to ₹50 lakh, and you must approach it within one year of the rejection. You can go to the consumer commission on e-Jagriti instead, within two years.

Step by step: what to do after a rejection

1. Get the rejection in writing. Ask for the repudiation letter with the exact clause relied on. “Policy terms” is not a reason. You need the clause number.
2. Read the clause against your policy schedule. Check waiting periods, exclusions, sub-limits, and what you disclosed in the proposal form.
3. File a written grievance with the insurer. Use the grievance email or portal, not just the call centre. Explain why the rejection is wrong, attach documents, and keep the complaint number. Under the 2024 master circular the insurer must acknowledge the grievance immediately and send a final reply within 14 days, giving reasons if it rejects the grievance.
4. Escalate on Bima Bharosa. If the insurer does not resolve it, register a complaint on IRDAI’s Bima Bharosa portal. IRDAI forwards it to the insurer and tracks the reply.
5. Go to the Insurance Ombudsman. File online at cioins.co.in, or by post or email, at the office with jurisdiction. You must have complained to the insurer first, and the same matter must not be pending before a court, consumer commission or arbitrator.
6. Or go to the consumer commission. If your claim is above ₹50 lakh, or you want a full adjudication, file a consumer complaint on e-Jagriti. See our e-Jagriti guide.

The Insurance Ombudsman in detail

The Ombudsman works under the Insurance Ombudsman Rules, 2017. It handles complaints against life, general and health insurers, and the 2021 amendment widened it to cover deficiency in service and brought brokers and other intermediaries within its reach. The key conditions:

• Prior complaint to the insurer. If the insurer rejects it, does not reply within 30 days, or you are not satisfied, you can approach the Ombudsman.
• One year. Approach within one year of the rejection, repudiation or partial settlement of the claim.
• ₹50 lakh. The value of the claim, including expenses, must not exceed ₹50 lakh.
• No fee. The Council for Insurance Ombudsmen states that no fee is charged.
• Award compliance. Under the 2024 master circular, an insurer must comply with an Ombudsman award within 30 days. If it does not, it pays the complainant ₹5,000 for every day of delay.

The government published draft amendments to the Ombudsman Rules in November 2025, including an appellate authority and changes to the ₹50 lakh cap. As on 29 October 2026 we could not confirm that they have been notified, so the 2017 Rules as amended in 2021 apply.

Health insurance: rules you should quote

IRDAI’s 2024 master circular on health insurance gives policyholders strong points to rely on:

• Cashless authorisation requests must be decided immediately, and within one hour.
• Final authorisation for discharge must be given within three hours of the hospital’s request. Extra charges caused by delay beyond that are to be borne by the insurer.
• No claim can be rejected without the approval of the insurer’s claims review committee.
• Policyholders need not submit documents for claim settlement; the insurer or TPA must collect them from the hospital.
• After 60 continuous months of cover (the moratorium period), a policy or claim cannot be contested for non-disclosure or misrepresentation, except on established fraud.
• Non-cashless (reimbursement) claims are to be settled within 15 days of submission of the claim.

If a claim is not settled in the required time, the 2024 circular entitles you to interest at 2% above the bank rate from intimation to payment.

Common mistakes

• Going to the Ombudsman without first writing to the insurer. The complaint will not be entertained.
• Waiting too long. One year from rejection for the Ombudsman. Two years from the cause of action for the consumer commission.
• Running two forums at once. If the matter is before a consumer commission or court, the Ombudsman will not take it.
• Arguing in general terms. Quote the policy clause and the IRDAI rule. Attach discharge summary, bills and the proposal form.

Example: Sunita in Nagpur is refused a ₹2.4 lakh hospitalisation claim for “non-disclosure of diabetes”. Her policy has run for over five years. She writes to the insurer citing the moratorium rule, gets no satisfactory reply in 14 days, escalates on Bima Bharosa, and then files with the Insurance Ombudsman at cioins.co.in, well within a year of the rejection.

Frequently asked questions

Is the Insurance Ombudsman free?

Yes. No fee is charged for filing a complaint.

My claim is ₹70 lakh. Can I go to the Ombudsman?

No. The limit is ₹50 lakh including expenses. File before the State Consumer Commission on e-Jagriti, since the consumer forum jurisdiction depends on the consideration paid.

Is the Ombudsman’s decision binding on the insurer?

Under the 2024 master circular, the insurer must comply with the award within 30 days of receiving it, unless it challenges the award within that time. Delay costs the insurer ₹5,000 per day, payable to the complainant.

What is Bima Bharosa?

It is IRDAI’s online grievance portal. IRDAI forwards your complaint to the insurer and monitors the response.

Can a legal heir complain about a rejected death claim?

Yes. A complaint can be filed by the policyholder, claimant, legal heir or assignee.

Quick quiz

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Sources

• Insurance Ombudsman Rules, 2017, as amended in 2021
• IRDAI Master Circular on Protection of Policyholders’ Interests, 2024 (5 September 2024)
• IRDAI Master Circular on Health Insurance Business, 2024 (May 2024)
• Consumer Protection Act, 2019: Section 69 (limitation); Consumer Protection (Jurisdiction of the District Commission, the State Commission and the National Commission) Rules, 2021
• Insurance Act, 1938

This page is for education and general information, not legal advice for a specific case. Law as on 29 October 2026.