How to appeal when your health insurance claim is denied

Compare Club Contributor

Compare Club Contributor

Updated 15/04/2021

You can appeal a rejected claim by compiling clear evidence and documentation to support your appeal, then submitting it to your insurer. Read more.

How to appeal when your health insurance claim is denied

Health Insurance Claim Denials & Appeals


You've submitted what you believe to be a legitimate health insurance claim only to have it denied.

There are probably a million questions running through your head: What's going on? Why was my claim denied? What can I do now?

If your claim has been rejected, you don't have to sit back and take it.

Although it may have been denied for a valid reason, it could also have slipped through the cracks.

Due to recent health insurance fraud, insurers have had to tighten up their claims processes.

Occasionally, this results in wrongly denied claims.

Key Points

  • Claims are denied for many reasons, including policy exclusions and restrictions, non-participating hospitals, and paperwork errors.

  • You can appeal a rejected claim by compiling clear evidence and documentation to support your appeal, then submitting it to your insurer.

  • Reduce your chances of claim denial by reading your policy carefully, paying your premiums on time, and checking in with your fund before being admitted to hospital.


Why was my claim denied?

The first thing to do is to figure out why your claim was denied.

The General Insurance Code of Practice requires insurers to provide reasons for rejecting your claim.

Typically, you'll receive a letter from your fund detailing the reasons for their decision.

Read the letter carefully to find out why your claim was denied.

Common reasons health insurance claims are denied

Your claim may have been denied for a number of reasons.

Here are some of the most common.

Treatment not covered by policy

Never assume that a treatment is covered by your policy.

Read the terms and conditions so you know for sure.

If you make a claim for a treatment that isn't covered, it will be rejected.

For example, many funds do not cover surgical and non-surgical cosmetic procedures.

This could include reconstructive surgery for cleft palates or even burns.

Most policies have restrictions and exclusions on benefits and services, so it's important to know what you're covered for.

Treatment from a non-participating hospital

If you were treated at a hospital that doesn't have an agreement with your fund, there's a good chance you won't be covered.

Check with your fund to find out which hospitals participate in their scheme, so you know what to expect before you are admitted for treatment.

Benefit cap

Some policies have benefit caps on specific services limiting the amount of benefits that can be paid out each year.

These caps should be clearly stated in the terms of your policy.

Annual limits may be calculated by calendar year, financial year, or in the 12 months since you took out your policy.

Check with your fund for details.

Waiting periods apply

In most cases, full benefits are not available immediately upon taking out a health insurance policy.

You usually have to sit a waiting period before you can be covered.

In general, the following waiting periods apply:

  • 12 months for pre-existing conditions

  • 12 months for pregnancy cover

  • 2 months for psychiatric care

  • 2 months for rehabilitation

  • 2 months for general benefits

Waiting periods are sometimes waived but this is up to your fund.

When switching policies, you should not have to repeat hospital cover waiting periods that you have already served, unless you are moving to a higher level of cover.


Benefit limitation periods

A benefit limitation period is an additional waiting period for certain kinds of hospital treatment like joint replacements.

If you make a claim during the benefit limitation period, you should not expect to receive the full benefit amount.

Expiry date

Did you wait too long before making a claim? Most funds will not pay out on a claim that is more than two years old.

Paperwork error

If you or your doctor accidentally submitted the wrong paperwork, it can lead to your claim being denied.

This could be as simple as sending in the wrong receipt or filling out information incorrectly.

It can be frustrating, but your chances of winning an appeal may be better in this case.

Appeal your rejected health insurance claim

The first step in a rejected health insurance claim is to lodge an appeal.

You usually have 30 to 90 days to launch your appeal, so do so as early as possible.

However, it's important to present a comprehensive case when doing so.

Before you approach your fund to contest the rejected claim, be prepared.

In some cases, questioning the rejection can be considered to be an appeal, and can hurt your chances to argue your case.

Here are some steps you can take to increase your chances of a successful appeal.

Get the claim denial in writing

Your insurer should have provided you with a letter when your claim was denied.

If they didn't, contact your insurer and ask for a refusal in writing.

Provide clear evidence for your appeal

Carefully read the letter explaining why your claim was denied.

You'll need to directly address the reasons listed for rejection and provide strong evidence to support your appeal.

Assemble relevant documents

Compile supporting documents such as medical records and information pertaining to your condition.

For example, if you were treated at a non-participating hospital because the treatment was unavailable at a participating hospital, medical records can help your appeal.

Keep track of any communication you have with your fund about the appeal.

Note down the date, time, who you spoke to, and what was discussed.

Submit your appeal in writing to the fund

Most funds have an internal dispute department or similar that is responsible for processing appeals.

Submit your appeal documentation and evidence, along with a cover letter explaining your case, to the appropriate department.

Await a response

It may take some time before your appeal is processed, but your fund should acknowledge receipt of your appeal.

My appeal was rejected! What now?

If your appeal is rejected, you have the option of taking it to the Financial Ombudsman's General Insurance Division.

If this doesn't provide resolution, it may be time to accept that your claim was invalid.

At this point you could also consider taking it to court, however this is a worst-case scenario and must be done within six years.

Making a strong claim

The majority of health insurance claims are usually paid out.

You can put yourself in a better position to have your claim accepted by being aware of the following factors:

Read your policy

That doesn't mean skim your policy; it means actually reading it from start to finish.

The same goes for any communication from your fund that is sent out during the year.

It may contain policy changes that you need to be aware of.

Be aware of exclusions and restrictions

When reading the terms and conditions of your policy, keep an eye out for any exclusions or restrictions.

Insurers will not pay out on any listed exclusions, and will only pay a limited benefit on restrictions.

Pay premiums on time

If you lapse in making payments, your insurer is within its rights to cancel your policy and refuse benefits.

If this happens, you may face waiting periods when you reinstate your policy.

Contact your fund before going to hospital

Whenever possible, get in touch with your fund before undergoing a hospital treatment.

Check that your hospital has an agreement with the fund and confirm whether the services are covered.

Document the conversation and ask for the information in writing where possible.

Having a health insurance claim denied is seriously disappointing, and hopefully it won't happen to you.

Be aware of what's covered by your policy and check in with your fund before undergoing any treatments to avoid bill shock.

If you do face a claim denial, take advantage of the opportunity to file an appeal. It may just work in your favour.


This article is opinion only and should not be taken as medical or financial advice. Check with a financial professional before making any decisions.