Claims Procedure in Term Insurance

A number of queries related to term insurance plans have been covered in our previous articles. An important part of any insurance plan is to know how claims can be made. Read on to know all about making a claim for term insurance.

In this digital world, everything can be done online – so is the case with claims. Gone are the days when one needed to fill up forms and make several rounds to the insurance office to lodge a claim. Today, everything can be done online. All one needs to do is go online and follow certain procedures.

How to Claim Term Insurance Online?

The claim of a term insurance can be made only after the death of the insured person and only when the policy is active. If the term has expired, no claim can be made. The nominee has to make a claim directly.

Every insurance company has its own claim procedure. However, the general procedure is outlined below:

The insurance company has to be intimated over phone or e-mail regarding the death of the insured person. This is done to keep a proof of the communication – be it written or oral.

Once informed, the insurance company will provide information on the procedure to lodge the claim under the term insurance. The procedure is similar for online and offline. In case of an online claim, all the forms have to be filled online.

The common forms and documents required by all companies for term insurance claims include the following:

• Claim Form A – This form contains the details of the claimant and the deceased person. One has to be cautious while filling this form since misinformation can lead to rejection of the term insurance claim.
• A copy of the death certificate issued by the local authority.
• In case the age proof of the insured person was not provided while purchasing the insurance policy, the same needs to be produced at this stage.
• In case a nominee was not appointed while purchasing the insurance policy and the claim is being made by the legal heir, then the proof of being the legal heir has to be provided.
• All original documents of the policy have to be submitted.
• Copies of ID and address proofs of the claimant have to be provided.
• Records of hospitalization and any medical records need to be submitted.
• In case of death by accident, a copy of the post-mortem or the FIR has to be submitted.
• The correct bank account details of the claimant needs to be provided for crediting the term insurance claim proceeds.

Several insurance policies get rejected due to incorrect filing of documents and callous attitude while filling up forms. It is strongly recommend to do the same diligently do avoid any sorry situation later on.

3 common mistakes that lead to rejection of claims

Filing an insurance claim is not something one does every day. The number of forms to be filled up – online or offline and the documents to be submitted can be disconcerting and confusing. Below are some of the common mistakes that people make while filing claims. Knowing about common mistakes made can help in avoiding them to a great extent.

1. Providing incorrect information:

While it is the claimant’s responsibility to provide all the accurate information in a claim, it is the policyholder’s responsibility to provide accurate information while purchasing the policy. Hiding significant facts and not maintaining transparency can lead to rejection of a claim. Take care while filling up the forms and always provide correct information. While purchasing an insurance policy, mention correct information about details such as height, weight, occupation, income and most importantly medical condition. The family members have to bear the brunt of incorrect information provided by the policyholder.

1. Refraining from medical tests:

People generally shy away from medical tests and this is the gravest mistake they can make. Refraining from medical tests leads to inaccurate underwriting of the policy and finally, results in rejection of claims. Ignoring tests and providing inaccurate information might feel good in the short term, but is a lethal mistake for the long term.

1. Not disclosing other insurance policies:

The premium of a term insurance depends on the other insurance policies held, because it significantly affects the risk undertaking of the insurer. Hence, while purchasing insurance policies, one must declare details about the other insurance policies. Many don’t know how important this aspect is.

It is hoped that one’s term insurance never reaches the claim stage. However, if it does, the insurer and the nominees need to know what to do. After all, isn’t insurance all about unforeseen circumstances?