The short answer

  • A refusal does not mean the money is gone. An insurer that refuses must give written notice and state its reasons, and those reasons can rest only on the contract terms and the scope of cover — never on company policy or industry practice.
  • Many refusals fail on procedure: an assessment that runs past the deadline, a customer-service agent saying over the phone that this is not payable, a notice that states no reasons — all of it shows the insurer is not confident either.
  • Blocking you with an exemption clause (免责条款) is its favourite move. But Article 17(2) of the Insurance Law of the PRC is uncompromising: where attention was not drawn to the clause and no clear explanation was given at the time of application, the clause has no effect — and that is just as true where you applied for cover yourself on a phone.
  • Blocking you with change of circumstances (情势变更) does not hold up. Article 533 of the Civil Code of the PRC gives renegotiation and the right to ask a court to modify or terminate the contract; it does not automatically release the insurer from a payment obligation that has already arisen.
  • The limitation period is only two years (five years for life insurance), running from the day you knew or ought to have known that the insured event occurred. Do not sit on it: fix the date first with a written claim.

An insurer must complete three steps before it can refuse

Article 23 of the Insurance Law of the PRC (statute text, excerpted): “After the insurer receives a request for indemnity or for payment of insurance benefits from the insured or the beneficiary, it shall make an assessment promptly; where the circumstances are complex, it shall make the assessment within thirty days, unless the contract provides otherwise… Where the claim falls within the scope of cover, the insurer shall, within ten days after reaching agreement with the insured or the beneficiary on indemnity or payment of insurance benefits, perform its obligation to indemnify or pay.”

Article 24 of the Insurance Law of the PRC (statute text, excerpted): “After the insurer has made an assessment in accordance with Article 23 of this Law, where the claim does not fall within the scope of cover, it shall, within three days from the date of the assessment, issue to the insured or the beneficiary a notice refusing indemnity or refusing payment of insurance benefits, and shall state its reasons.”

My reading: the assessment deadline, the written refusal and the statement of reasons are hard constraints. What happens most often in practice is a customer-service agent saying on the phone that this is not payable, with no notice issued and no reasons given. Many people give up at that point. That is not the insurer being strong; that is the insurer not having finished the procedure.

Four grounds for refusal — two of them usually hold up

The grounds insurers give vary widely, but in legal terms there are only four categories.

  • The first: the event does not fall within the scope of cover. This is the strongest ground for refusal — the policy covers what it covers, and the event has to fall inside that scope. Desert off-roading rollovers, drink-driving, driving without a licence: these are usually genuinely not payable.
  • The second: the duty of truthful disclosure (如实告知) was not complied with at the time of application (Article 16). Note the precondition: the applicant owes that duty only where the insurer raised questions about the subject matter insured or the insured. Answer whatever the health declaration asks; what it did not ask, the insurer cannot afterwards blame you for not volunteering. Its right of rescission is also time-limited — it is extinguished if not exercised within thirty days of knowing the ground for rescission, and once the contract has been in existence for more than two years it may not rescind in any event, and must still pay if an event occurs.
  • The third: a significant increase in the risk insured (危险程度显著增加) was not notified (Article 52). Supreme People’s Court Case Database, database entry no. 2025-08-2-333-002: the owner insured the car as a family private vehicle, drove it into the desert for dune driving and rolled it over. The court held that dune driving significantly increased the risk to the vehicle and to the driver, the owner had not notified the insurer, and the insurer was not liable under the policy.
  • The fourth: reliance on an exemption clause. This is the category most easily overturned, because it turns on whether the insurer performed the duty to draw attention (提示义务) and the duty to explain clearly (明确说明义务) — see the next section.

Supreme People’s Court Case Database, database entry no. 2025-18-2-483-001 (personal insurance): the policy used a broad medical concept, congenital disease, as an exemption clause. The court held that the insurer had not only to draw attention to it but to explain clearly which specific conditions and consequences that concept covered; unable to produce evidence that this had been said, it could not use the clause to limit payment.

Database entry no. 2023-16-2-333-002 (property insurance): the owner applied for cover himself on a phone, and the policy’s special agreement provided that, after a loss, parts would be compensated at dismantled-vehicle part prices. The court held that this was in substance a standard-form clause reducing the insurer’s liability; the insurer proved neither that it had drawn attention to it nor that it had explained it, so the clause did not take effect, the loss was paid in full on a third-party assessment, and the assessment fee was borne by the insurer (Article 64).

Change of circumstances is not a shield against paying

Article 533 of the Civil Code of the PRC (statute text): “After a contract is formed, where the basic conditions of the contract have undergone a major change that the parties could not have foreseen at the time of contracting and that does not constitute a commercial risk, and continued performance of the contract would be obviously unfair to one party, the party adversely affected may renegotiate with the other party; where no agreement is reached within a reasonable period, the party may request the people’s court or an arbitration institution to modify or terminate the contract.”

In my view, this provision fails at three points when it is used to refuse a claim. First, what it gives is renegotiate — and if that fails, ask for modification or termination: a route for dealing with the contract, not a single sentence releasing the insurer from liability to pay. Second, the insured event under a COVID policy was infection with COVID; a widespread epidemic is the realisation of the very risk underwritten, not a change in the basic conditions of the contract. Third, once the insured event occurs, the insurer’s obligation to pay becomes a fixed monetary debt, and there is no question of continued performance being obviously unfair.

Think about it the other way round: if too many people getting infected could be a reason not to pay, what exactly was this insurance selling?

My own two COVID policies

During the pandemic a few years ago, insurers were all selling COVID policies — a few dozen yuan each, promising five thousand or ten thousand if you were infected. My wife and I each bought one. Then everyone was infected, and a group of insurers across the country refused to pay en masse; some of them trotted out the change-of-circumstances argument above.

I sued in a basic-level court in Shenzhen. Filing was delayed for a long time, and I kept complaining on 12368. Eventually the judge handling the case telephoned to say the insurer had agreed to pay and asked me to withdraw the case. I said fine, but my wife’s policy had to be paid as well, and the other side agreed. In the end RMB 10,000 for the two policies arrived — and what the receipt said was not indemnity; it said ex gratia payment (通融支付).

Ex gratia payment is an industry expression: the money is paid, but the contractual obligation is not admitted. For an individual, the money arriving is the first priority; but you should also read it correctly — the fact that it was willing to hand over that RMB 10,000 shows precisely that it knew it would lose if the case went on. Most policyholders at that time got nothing, not because the law gave them nothing, but because they felt a few dozen yuan was not worth the trouble. As for why filing was difficult during that period, that was the handling approach of the time, not a problem with the law itself.

If you really are going to sue, prepare four things first

  • Jurisdiction. Article 25 of the Civil Procedure Law: an action arising from an insurance contract dispute is under the jurisdiction of the people’s court of the place where the defendant is domiciled or the place where the subject matter insured is located (保险标的物所在地); an action arising from a personal insurance (人身保险) contract dispute may also be under the jurisdiction of the people’s court of the place where the insured is domiciled (Interpretation of the Civil Procedure Law, Article 21(2)). COVID policies, critical-illness policies and medical policies are all personal insurance, so you can usually sue in the court on your own doorstep.
  • Limitation. Article 26 of the Insurance Law of the PRC: for insurance other than life insurance, the limitation period for claiming payment is two years; for life insurance it is five years, in both cases running from the day you knew or ought to have known that the insured event occurred. Once the period has run the substantive right still exists, but a single objection from the other side and you lose.
  • Evidence. The policy and screenshots of the application page, payment records, the full policy terms (especially the page containing the exemption clause), the diagnosis certificate or test report, the medical record, the refusal notice or customer-service chat logs, and receipts for expenses necessarily incurred in pursuing the claim.
  • Costs. Necessary and reasonable expenses paid to ascertain and determine the nature, cause and extent of the loss are borne by the insurer (Article 64). Where the claim does not exceed RMB 10,000 the filing fee is RMB 50 per case, and it is halved under summary procedure (Articles 13 and 16 of the Measures for Payment of Litigation Costs, 《诉讼费用交纳办法》); a case worth a few thousand yuan therefore usually costs tens of yuan.

Action checklist

  • Apply for payment in writing first — through the app, by email or by courier — and keep the submission time and the tracking number: that is the starting point for the thirty-day assessment period and for the two-year limitation period.
  • Demand a written refusal notice stating reasons; where all you get is an oral refusal, complain to the 12378 hotline of the National Financial Regulatory Administration.
  • Screenshot and file the application page, the terms, and the page containing the exemption clause, and look closely at whether attention was drawn to it and whether it was explained to you.
  • Classify the ground of refusal: outside the scope of cover, breach of the duty of truthful disclosure, or reliance on an exemption clause — the last two are the easiest to overturn.
  • If the amount is small and you want speed, negotiate first. Say plainly in the negotiation that you are already preparing the filing materials; a fair number of cases are settled ex gratia at that stage.

Final note

This article describes general rules. Individual cases differ greatly: whether what you bought was a disease policy, a medical policy or an accident policy, how the terms are worded, how the health declaration was completed at the time, and which clause the refusal notice cites will all change the conclusion. The statutes are cited in their currently effective versions, and the cases are cited only by database entry number and holding, without reference to the parties involved.

If an insurer is refusing your claim, you are welcome to contact Wang Xin: telephone 186-0113-9509, WeChat wang223040.

Quick answers

Must I simply accept an insurer’s refusal to pay in China?
No. A refusal must be in writing and must state reasons, and those reasons can rest only on the contract terms and the scope of cover — not on company policy or industry practice. Where an exemption clause was neither pointed out nor explained at the time of application, it has no effect.
Can an insurer refuse a COVID insurance claim on grounds of change of circumstances?
Generally not. Article 533 of the Civil Code of the PRC provides for renegotiation and, failing that, a request to the court to modify or terminate the contract; it does not extinguish a payment obligation that has already arisen. A widespread epidemic is the realisation of the risk underwritten, not a change in the basic conditions of the contract.
How long do I have to sue an insurer in China?
Two years for insurance other than life insurance, and five years for life insurance, running from the day you knew or ought to have known that the insured event occurred. File a written claim early: it also starts the insurer’s thirty-day assessment period.

This is an English edition of Wang Xin’s original Chinese article, 保险公司拒赔，就只能认了吗？从新冠险集体拒赔讲起. It explains the law of the People’s Republic of China in general terms and is not legal advice for any particular case; outcomes depend on the specific facts and on how local authorities apply the rules.