"We Found Discrepancies" — When Insurers Reject Without Explaining Why

The Hospital Was Real and Registered

The one concrete thing the family was able to verify: the hospital was legitimate. It was a 44-bed licensed facility, registered with the state pollution control board under the Biomedical Waste Management Rules. The hospital had a valid biomedical waste authorisation issued for a multi-year period.

In other words, the insurer's allegation — whatever it was — could not easily be that the hospital didn't exist or was a fictitious entity. But the insurer never specified what the "discrepancy" was. So the family had no way of knowing whether the allegation related to the hospital, the treating doctor, the diagnosis, the dates of admission, or something else entirely.

Why Vague Rejections Are a Problem — Legally

IRDAI's guidelines on claim processing are explicit: a rejection letter must be a "speaking order." This means it must:

1. State the specific reason for rejection
2. Cite the exact policy clause or section being invoked
3. Provide enough information for the insured to understand and contest the decision

A letter that says "we found discrepancies" without specifying what they are fails on all three counts. The right to contest a rejection is meaningless if the rejection doesn't tell you what you're contesting. A vague rejection letter is a procedural tool that forecloses challenge — and IRDAI is aware that it is sometimes used that way.

The Path Forward When You Receive a Vague Rejection

Step 1: Demand a specific response in writing. Send a formal letter to the insurer's grievance officer asking them to: identify the specific document(s) in which the discrepancy was found; describe the nature of the discrepancy; cite the exact clause and clause number; and confirm whether the alleged misrepresentation was made by the policyholder or a third party. Give them 15 days to respond.

Step 2: Verify the hospital's credentials independently. Gather every piece of documentation confirming the hospital's legitimacy — registration certificates, licences, state health department approvals, biomedical waste authorisations. These are public records and hospitals can provide certified copies.

Step 3: Compile the hospitalisation timeline. Obtain every original document from the hospital: admission register extract, discharge summary, all treating doctors' signatures, OPD/IPD case sheet, investigation reports. Look for anything that could be internally inconsistent and clarify it proactively.

Step 4: File a formal grievance with the insurer. Explicitly state that the rejection letter does not meet IRDAI standards for a reasoned order and request a compliant response.

Step 5: Escalate to the Insurance Ombudsman through the Bima Bharosa portal. The grounds for your complaint include both the substantive rejection and the procedural failure to provide a reasoned order.

Step 6: File with IRDAI's IGMS. A failure to issue a reasoned rejection letter is a regulatory violation — it goes on the insurer's compliance record and attracts regulatory attention.

What the Allegation Was Probably About

In cases like this, where the insurer alleges "hospitalisation details discrepancies" at a hospital of borderline profile, the allegation often relates to one of the following:

• Admission duration discrepancy: Dates on the claim form don't match dates on the hospital records
• Diagnosis mismatch: Diagnosis on the claim form differs from the discharge summary
• Agent-level fraud: The insurer suspects the treating doctor or a third party assisted in inflating or fabricating portions of the claim — but doesn't want to make that allegation explicitly
• Hospital empanelment issues: The insurer may have internal red flags about the hospital that they are not disclosing

In all these scenarios, the insured has a right to know. And if the insurer is relying on intelligence or investigations they haven't shared with the claimant, they cannot use those to justify a rejection without disclosure.

What This Case Teaches Policyholders

You have the right to know why your claim was rejected. Not in vague terms, not by implication — in specific, documented, clause-referenced terms.

"We found discrepancies" is not a reason. It is a statement designed to sound final while leaving the insurer room to backfill specifics later. Push back immediately.

Hospital legitimacy can be documented. Government-issued biomedical waste authorisations, state health department registrations, and district hospital licences are verifiable public records.

A procedural failure can be as powerful as a substantive one. Even if the insurer eventually articulates a real reason for rejection, their initial failure to provide a reasoned order is itself a ground for compensation at the consumer forum.

Case details have been anonymised. This article is based on documents reviewed as part of FairClaims' 2026 case intake. It is for informational purposes only and does not constitute legal advice.