What is cashless claim settlement?

Updated on - 04 Feb 2026

The rising cost of healthcare in India underscores the importance of a cashless health insurance plan. In an emergency, only a policy can cover the bills and ensure effective treatment. However, the process can be tedious if you are not aware of it. Therefore, understanding how a cashless claim settlement works is important to avail the benefits on time.

The blog outlines everything you need to know about cashless individual health insurance and how it differs from reimbursement. It also discusses the steps to avail the claim and common reasons for rejection.

What is cashless health insurance?

Cashless health insurance refers to policies that offer cashless claim settlement. Under such policies, when a policyholder is admitted to a network hospital, the insurer and the hospital coordinate to settle the medical expenses directly. To avail of this facility, the policyholder must inform the insurer within a specified timeframe, usually at least two days before planned hospitalisation and within 24 hours in case of emergencies. The hospital administration then contacts the insurer, sending a pre-authorisation form to initiate the claim settlement process.

Cashless health insurance is when the policy provides claim settlement without requiring payment up front. The insurer and the network hospital coordinate to settle the medical expenses. In such a situation, the policyholder has to inform their insurer within the stipulated timeframe. There is generally a 48-hour time limit for general admission and a 24-hour time limit in case of an emergency. After you fill out and submit the pre-authorisation form, the claim settlement process is initiated.

What is cashless claim settlement?

As a policyholder, there are two ways you can make a claim: cashless claim settlement and reimbursement claim settlement.

Cashless claim settlement

Remember, you can avail of this benefit only at a network hospital. Under your policy terms, with cashless coverage, you can seek treatment at a network hospital. All you need is your insurance card and policy details. The insurer will settle your bills directly with the hospital.

Reimbursement claim settlement

Reimbursement claim settlement is primarily used in cases where the insured either cannot access or wishes to seek service at a network hospital. Most insurance policies allow you to utilise the services of a network hospital of your choice. However, in such situations, you must pay the bills upfront and later claim reimbursement from the insurer. To claim reimbursement, you will have to submit the original documents, bills, reports, etc., along with the duly filled-out claim request form. Once your documents are verified, the insurer transfers the reimbursed amount to your bank account.

How does cashless claim settlement work?

Given below is the cashless claim settlement process for health insurance:

• In case of a medical emergency, get admitted to a network hospital.
• Every network hospital has an insurance desk. You can get all the information regarding claim settlement here.
• Ask for a pre-authorisation at the insurance desk. Or, get a declaration from the Third Party Administrator (TPA). Get a printout of the same. You can also get a declaration form from TPA.
• Submit the necessary form along with the pre-authorisation letter or the TPA declaration.
• You will get an email confirming coverage and the maximum sanctioned amount.
• Once the treatment is completed, if the bill incurred is within the sanctioned amount, you will not have to pay anything. If the bill exceeds the limit, you are liable to pay the additional amount.

Steps for cashless claims

To effectively utilise the cashless claim facility, policyholders should follow these steps:

1. Choose a network hospital: Ensure the hospital where treatment is sought is in the insurer's network. This information is typically available on the insurer’s website or through customer service.
2. Inform the insurer:

• Planned hospitalisation: Notify the insurer at least two days before the scheduled admission.
• Emergency hospitalisation: Inform the insurer within 24 hours of admission.

1. Provide necessary documentation: Present your health insurance card and a valid ID at the hospital. The hospital will assist in filling out the pre-authorisation form and submitting it to the insurer.
2. Await approval: The insurer will review the pre-authorisation request. Upon approval, the treatment can proceed without any upfront payment from the policyholder.
3. Post-treatment process: After discharge, ensure that all original documents, bills, and discharge summaries are retained, as the insurer may require them for their records.
4. Settlement: The insurer will directly settle the approved amount with the hospital. Any non-covered expenses or exclusions will be the policyholder’s responsibility.

Documents required for a cashless health insurance claim

The documents needed at the time of availing a cashless insurance claim are:

• Cashless claim form
• Discharge summary
• Past medical records
• Hospital bill
• Pharmacy bill and prescriptions
• Consultation papers
• Photo ID card with a cancelled cheque

Benefits of cashless claim settlement

A cashless medical insurance policy helps simplify the treatment process for you. Here is why it is a trusted option for many:

• You can access any of the network hospitals listed under the policy.
• You don’t need extensive documentation, as the authorised TPA person will take care of everything.
• You don’t need to incur any expenses at the time of an emergency or planned treatment.

Steps to avail a cashless health insurance claim

Here is how you can easily access a cashless claim through your individual health insurance agent:

• Find the nearest network hospital and inform the TPA for smooth processing.
• Show your health card and ID proof to the hospital insurance desk.
• You can either download the claim form from the official TPA website or pick it up at the hospital.
• The hospital will share the form with the TPA for authorisation.
• The patient should admit themselves within 15 days of TPA approval.

Difference between cashless and reimbursement claim

The table below explains how a cashless claim differs from reimbursement:

Common reasons for cashless claim rejection

There are a few reasons why your cashless claim might be rejected:

• Waiting period: Certain diseases require a waiting period. In case that period isn’t exhausted, you cannot file a claim.
• Certain diseases: Your insurance policy might not cover a few of the listed diseases or illnesses.
• Withholding of information: In case you don’t disclose your pre-existing condition, you would not be able to file for a claim.
• Wrong information: Mentioning false information about a pre-existing health condition can lead to termination of your insurance policy.
• Lapse of policy: You cannot request a claim on an expired or invalid policy.

Network hospitals and their role in cashless claims

A network hospital streamlines the process of cashless treatment. You don’t have to pay the medical costs upfront, reducing your overall financial burden. Here is how the hospitals play a key role in processing your insurance claim:

• Quality Healthcare Service: Network hospitals have to adhere to the insurance company’s care standards. Therefore, they have advanced medical facilities and equipment.
• Cost-Effective Process: Hospitals have pre-negotiated rates with companies to save costs for policyholders.
• Smooth Claim Settlement: The network hospitals have a smooth claim process that minimises the administrative work.
• Wide Coverage: Hospitals are available across locations, making it easier to access healthcare facilities.

How to find network hospitals for cashless health insurance

You can find a trusted network hospital for your health insurance plan through one of the following ways:

• Scan the policy documents for the dedicated list of hospitals.
• Insurance companies list their affiliated network hospitals on their official mobile app and website.
• Connect with the insurance company’s customer care representative to retrieve the information.

Tips to ensure smooth cashless claim processing

Here are the tips to follow so you can claim your individual health insurance smoothly:

• Understand your policy details and be aware of the expenses and treatments that are not covered.
• You need to disclose your pre-existing health conditions, as misleading the insurer can lead to rejection.
• Access the list of network hospitals to avail of cashless benefits easily.
• Keep your documents readily available to submit to the hospital on time.

Conclusion

A cashless claim settlement can help you stay prepared in times of need. Instead of arranging finances for a medical emergency, you can depend on your insurance to take care of the admission, diagnostic tests, and consultation expenses.

Let us take care of your well-being in times of injury and illness with the right policy. Fill out the form on this page, and our insurance experts will consult and curate a plan specifically for you.

FAQs

1. How can I avoid a cashless claim rejection?

Mention your pre-existing illness to the insurance company, get treatment only at a network hospital, and inform your insurer that you are being admitted to a hospital before you visit.

2. Which medical illnesses are not covered under a cashless insurance?

Pre-existing diseases (waiting period of 2 to 4 years), STDs, congenital diseases, and substance abuse-related diseases are not covered under the insurance plan.

3. Is a cashless claim better than reimbursement?

Yes, a cashless claim is safer than reimbursement, as you don’t need to pay an upfront cost to the hospital.

4. Does a cashless insurance policy offer tax benefits?

Yes, a cashless health insurance offers tax benefits under Section 80D. You can claim it while filing your tax return.

Disclaimer: The information provided in this blog is for educational and informational purposes only. It may contain outdated data and information regarding the topic featured in the article. It is advised to verify the currency and relevance of the data and information before taking any major steps. ICICI Lombard is not liable for any inaccuracies or consequences resulting from the use of this outdated information.