Mental health claim rejected?
Claims for treatment of depression, bipolar disorder, addiction and other mental illnesses are sometimes refused as if they were not covered at all. The law says they should be treated the same way as physical illness.
What the law says
Section 21(4) of the Mental Healthcare Act 2017 says every insurer shall make provision for medical insurance for treatment of mental illness on the same basis as is available for treatment of physical illness.
IRDAI’s 2024 health insurance master circular requires insurers to comply with the Mental Healthcare Act.
What “the same basis” means in practice
- A blanket exclusion of mental illness doesn’t fit the law.
- The usual policy terms still apply equally: in-patient cover, room rent, sub-limits, waiting periods and the pre-existing disease rules.
- If your policy covers a physical illness in hospital, it should cover a mental illness in hospital on comparable terms. If it doesn’t cover out-patient care for physical illness, it may not cover out-patient therapy either.
Common reasons given, and how to test them
- “Mental illness not covered”: ask which clause says so, and compare it with section 21(4).
- “Pre-existing condition”: a condition only counts if it was diagnosed or treated within 36 months before the policy started. See our pre-existing disease guide.
- “Non-disclosure”: you only had to disclose what the proposal form asked. After 60 months of continuous cover, non-disclosure can’t be used except for fraud.
- “Admission not needed”: ask the treating psychiatrist for a note on why in-patient care was needed.
What to do
- Get the rejection letter and the clause it relies on.
- Write to the Grievance Redressal Officer, citing section 21(4) and the policy terms for comparable physical illness.
- If it isn’t resolved, complain to the Insurance Ombudsman. Not following the law and IRDAI’s rules is a ground for a complaint.
Questions people ask
Does health insurance in India cover mental illness?
The Mental Healthcare Act 2017 requires insurers to provide cover for mental illness on the same basis as for physical illness, and IRDAI requires insurers to comply with the Act. Your policy’s terms still apply equally to both.