There are so many things which affects your claim settlement and the most important of all of them is ROOM RENT CAPPING.
Now lets understand this quickly with the help of an example.
Mr. A has a health insurance policy of Rs. 3,00,000 in which there is a room rent capping of 1% of sum assured which comes to Rs. 3000 (3,00,000*1%) room rent limit on a per day basis.
He met with an accident and was hospitalized for 4 days. The rent of the room in which he was hospitalized was Rs. 4500 per day. Now total expenditure on 4 days was Rs. 2,00,000 which includes Rs. 18,000 (4500*4) as room rent and the balance Rs. 1,82,000 (2,00,000 – 18000) as other expenditure.
Now in this case if I ask you how much claim would Mr A get from the insurance company. Most of us would Say Rs. 1,94,000 (1,82,000 +12,000) This figure we arrived at after deduction of Rs. 6000 (1500*4) from the room rent. His eligibility of room was for Rs. 3000 on a daily basis but he got admitted to a room whose rent was Rs. 4500 that is Rs. 1500 extra. Since the stay was for 4 days , hence insurance company would not pay Rs. 6000 (1500*4).
But this is not how the claim would be calculated. Generally in a hospital, all other charges are linked to room rent. So if there is a violation of room rent limit, the insurance company makes the reimbursement on a Pro rata basis.
So in the above example, the insurance company will find out Rs. 3000 (room rent eligibility) was how much % of Rs. 4500 which comes to 66.67%. Actual claim was Rs. 2,00,000. So, instead of paying Rs. 2 Lac, insurance company would reimburse only Rs. 1,33,333 (2,00,000*66%).
So to avoid this scenario, just go for a health insurance policy which does not have any restriction on room rent.