Is Your Family Ready to Handle Life Insurance Claim Rejection? Steps to Avoid It

It would be great if you have invested in an insurance cover early in your life. Now that your loved ones are duly secured against an unfortunate event, are you sure that this insurance will be enough ten years down the line? Do you think your current insurance plan will be enough to cover them adequately in the future?

With time, your life changes, and so does your lifestyle. Sometimes, not disclosing even the slightest thing about yourself can lead to the rejection of a claim! 

Sometimes you knowingly ignore crucial does and don’ts when you are looking through different types of insurance. As a result, your family will have to suffer a setback at the time of claims settlement. Even a small mistake while purchasing life insurance could result in the insurance company refusing to pay your nominee. The good news, however, is that this scenario is entirely avoidable. 

Read to know how you can safeguard your family against the risk of claim rejection and ensure that they get the sum assured you have planned to leave behind for them. 

Never hold back any information

Don’t forget to tell your insurance company even the smallest information that may harm your health or may result in a medical condition that can lead to hospitalization. Don’t want to risk being denied the death benefit on the grounds of ‘concealment of information?’Then make sure you proactively disclose all smoking/drinking habits, pre-existing medical conditions, or anything that can be linked to the cause of your hospitalization or death. 

Not revealing all these details will result in the insurer withholding the sum assured and other benefits, even if you made the premium payments regularly. Since your premiums are based on this information, it is both crucial and ethical to divulge all these details when you buy online insurance.

Pay Premiums on Time

Your family members are entitled to the sum assured only when your policy status is active. Delaying premium payments can result in lapsed policies. If your policy lapses, you will no longer be covered by your insurance and all the premiums paid so far will be nullified. Depending on the types of insurance you choose, you may also have to pay reinstatement charges and delayed payment penalty charges to reactivate your policy. 

Always Declare Your Nominee

Always remember to nominate someone in your family when you buy online insurance. A nominee will be the beneficiary of the death benefit when the time comes. If you are married, you can name your spouse or children; if you are single, you can nominate your parents to receive the benefit. Nominees are generally the people who are directly dependent on you and your income.  

Never Delay in Filing Insurance Claims

As you are reeling from the loss of your loved one, filing for claims is probably the last thing on your mind. However, it is essential to give one quick call to the insurance company to initiate the claims process. Remember, they spent a lifetime building a security cover for you. A delay from your end can render that effort useless. Hence, you must make sure that the responsibility is delegated to someone who can. Your insurance provider needs to be intimated about the events as early as possible to simplify ad expedite the claims processing.

Fill out the Details Correctly 

The insurance company honours the claims based on all the information you filled out in the forms. Therefore, it is always better to do that step yourself. When you buy online insurance, you will also be able to use the portal for filing claims where you can enter all the requisite details accurately to get the sum assured within the stipulated time frame. Reputed insurance companies usually disburse the death benefit within 30 days of receiving all the documents and clarifications. Please fill out all the details truthfully and accurately to help the insurance provider do their job quickly.

Be Receptive to Medical Examinations

Insurance companies sponsor your medical examinations to understand your medical condition. The more they know, the less likely they are to deny your family the sum assured. These tests are also helpful in detecting diseases early and get them treated accordingly. 

Read Your Policy Document Thoroughly

The policy document has every tiny detail about the contract between you and the insurer. This is important because filing for a claim due to any reason listed in the “exceptions”list will lead to claim rejection. When you buy insurance online, the policy document becomes available for you to download and read at your convenience. So makes sure you are fully aware of all the clauses and exceptions to be able to choose the right insurance cover for you and your family.

Apart from following the above mentioned steps, you can also explore term plan options from insurance providers such as Max Life Insurance that have high claim settlement ratios.