Zerodha’s Nithin Kamath warns: Your insurance policy might let you down

Having insurance is not a guarantee your claims will be processed or paid in full. As Zerodha co-founder Nithin Kamat pointed out in a recent post on X:  “Just because you have insurance doesn’t mean all your claims will be processed. Insurance companies often don’t pay claims in full or flat-out reject them.” 

Knowing why claims get denied—and how to avoid it—is critical.

Kamath shared data from insurance startup Ditto which reveals 31% of rejections stem from non-admissible claims, often due to waiting period issues. About 28% of claims are rejected for non-coverage reasons, including unnecessary hospitalizations. 

Insurer delays account for 8% of denials, with fraudulent claims contributing further.

The Claim Settlement Ratio (CSR) is a key metric to evaluate insurers. In the data shared by Kamath, HDFC ERGO leads with a 98% settlement rate, followed by Digit and SBI General at 97% each. The industry average, however, lags at 85%, with insurers categorized as stellar (>90%), decent (80-90%), or no-go (

Health insurance claims in India have surged 30% over the past three years, driven by rising healthcare costs and a growing burden of chronic diseases like heart conditions, diabetes, and cancer. Average claim payouts increased from Rs 62,014 in FY23 to Rs 81,025 in FY25, reflecting the strain on family finances.

Understanding your policy terms is crucial. Awareness of waiting periods, coverage exclusions, and necessary documentation can prevent claim rejections. Additionally, opting for policies with riders like critical illness or accidental death benefits ensures broader coverage.