Purchasing life insurance means providing financial stability to your family after your unfortunate demise. Thus, one should choose a life insurance policy with a high claim settlement ratio because it not only assures your family’s financial stability but also relieves them from the inconveniences associated with filing a claim. Many of us believe that paying claims is the job of the insurance company. However, we must remember that policyholders also play a crucial part in streamlining the process. Irrespective of the life insurance plan, you have got, here are some simple tips that can guide you toward a smooth life insurance claim settlement:l
Intimate the insurance company on time: The first and most important step in the claim settlement procedure is to notify the insurance company in a timely manner. In the event of the policyholder’s death, the nominee or beneficiary must promptly notify the insurance company to avoid delays. All you need to do is contact your insurance company via phone or email.
Keep all of your documentation organized: After you’ve alerted the insurance company, the following step is to provide certain documents of your ULIP plan to the insurance company. Keep all of your documents together because if one goes missing while making a claim for your ULIP plan or any other plan you have, the procedure may take longer to begin the process. In the event of a death or maturity benefit, it is advisable to submit the documentation ahead of time.
Submit accurate details: When filling out an insurance form, you must be accurate with all of the information you provide on the application form. After you’ve entered all of the information, you should double-check it to ensure there are no errors or misleading information. Furthermore, you should be open about your previous and current health concerns. Also, if you smoke or drink regularly, you are required to state it. Small errors or anomalies might cause huge problems during claim settlement. As a result, you should be upfront about your present health status and smoking/drinking habits, as many people believe that if they provide accurate information about their lifestyle, their insurance will be refused. However, this is not true. You may have to pay higher premiums, but your coverage will not be denied. It is never advisable to conceal information about one’s health or lifestyle, as it is preferable to pay higher rates than to have a claim denied after paying premiums for an extended period of time.
Go through your insurance paperwork thoroughly: It is critical to carefully study your policy documents because it will not only inform you of its contents and exclusions, but it will also provide you with guidance on what to do and not do when submitting a claim. If you use the mobile app, you can know the inclusions and exclusions of ULIP or any other plan you have bought.
Understand the claim settlement procedure: As a policyholder, you must be aware of all aspects of the claim settlement process, including documentation and other requirements. Update your policy on a regular basis to ensure that it has updated current information. In the event of a change, the policy should be updated with everything from the name, address, contact number, and health status. Additionally, if the beneficiary’s name or address changes, you must notify your insurance company as soon as possible. Additionally, you should preserve proof of the same.
Educate the nominee about your plan: Once you’ve understood the policy and the claim settlement method, the following step is to ensure that your nominee is fully informed of the policy’s terms and conditions. He or she should understand everything about the insurance, including the premium amount, policy terms, and sum assured. Furthermore, the nominee should understand all of the policy’s provisions and exclusions and the same life insurance can be easily understood via the mobile app as well.
Your information, whether deliberate or unintentional, determines whether your claim will be accepted or rejected. Here are a few reasons why term insurance claims are rejected:
Intentional Withholding of Information: If you did not disclose any health risks when applying for a policy, and this comes to light while submitting a claim, it may be grounds for rejection. In some situations, this may also constitute fraud. Legally, it provides the insurer the authority to deny or even cancel the insurance or refuse to provide the claim.
Misleading or misrepresenting information: This includes medical history, dangerous hobbies or behaviours, dangerous occupations, and whether the cause of death was suicide. If you withhold relevant facts, the insurance company may legally decline the claim.
Non-Disclosure of Existing Life Coverage: If you have existing life insurance or if it exceeds the Human Life Value (HLV), your claim may be denied. The HLV is determined using a variety of features, including age/working years remaining and future earning/saving potential, and it is a finite figure. Because HLV cannot be endless, it is not prudent to over-insure one’s family, dreading the worst. Given the conditions, the entire claim may be refused in the event of death if the applied cover and existing cover exceed an individual’s overall insurability, putting the family in serious problems.
Lapse in Policy: If a policy has lapsed owing to nonpayment of premiums on the due date, insurers typically grant a grace period. However, if the payment is not made even after the grace period, the policy will expire. Following this, no claims for death or maturity will be accepted. As a result, you must make all premium payments on time.
Nominee information: Most people fail to update the nomination information after their parents’ marriage or death. If you file a claim for death or maturity and the nominee is no longer available or the information is wrong, your claim may be rejected.
