According to the Insurance Regulatory and Development Authority (Irda), of the 7.62 lakh life insurance claims filed in 2009-10, nearly 15,000 were rejected by insurers. Meaning 15,000 families were denied the money that the policyholders had thought would reach them if they died! So you see numerous life insurance claims are rejected on various grounds and this articles is going to help you avoid rejection of your claim.
Firstly invest in an insurance policy and secure yours and your family’s future. You can avail of many offers available online that suit your purpose and benefit you.
The rejection ratio (rejected claims as a percentage of the total claims received and pending during the year) of some companies, especially those which started operations a few years back are very high. Namely, Aegon Religare rejected 45% of the claims, Future Generali, IDBI Federal and DLF Pramerica rejected one of every fifth claim raised (20%) whereas LIC has a rejection ratio of 1.1%.
This does not mean that one should not buy insurance from new insurance companies as claim settlement ratio or rejection ratio does not give the complete picture. Many a times the claims are rejected because the insurance company believes that pertinent facts were deliberately suppressed by the policyholder at the time of buying the cover.
An insurance company sizes up the risk of covering an individual on the basis of his health, medical history of his family, income, occupation and existing insurance cover. And based on the information disclosed the risk is properly assessed and priced accordingly. If an insurance company has reason to believe that any information pertaining to these parameters was suppressed, it can reject the claim.
Make sure you inform the agent that he is not really doing any favor if he deliberately overlooks any health problem or fills the form incorrectly as in the long run you would suffer as your claim will be rejected on grounds of non-disclosure of the pre-existing ailment.
This is especially true in case of low value insurance policies. Before they sell a policy, insurance companies subject the buyer to a range of medical tests.
Try not to rely on agents and fill the application form yourself. Ask him if you get stuck, but try and do it yourself. Just in case you are unable to fill it yourself go through the form after the agent has filled it up and then only sign it. Also retain a photocopy for your own record.
When you get the policy document and a photocopy of the form that you filled up, match it with the copy you have. This will ensure that all the information given in the form is correct.
Do not hold back any information relating to your health and family medical history.
Even disclose facts like use of tobacco and alcohol consumption.
Contrary to popular perception, a rigorous medical test actually helps the buyer. Because if a company gets the tests done, it rules out the chances of the claim being denied on account of preexisting diseases.
State correct age, occupation, income and other insurance cover. Your age defines the risk, so any inaccuracy can lead to rejection.
If your work profile involves risk, give the true picture.
Don't overstate your income so that you can buy a large cover.
Check the policy document carefully and notify the insurance company if there is any inaccuracy. In case of minor changes, the insurance company will simply send a letter confirming the new issuance terms. But if there are material changes which have a bearing on the original terms, the buyer may be asked to undergo additional medical tests to ensure that the risk cover continues.
Submit genuine documents like copies of your PAN card, identity proof, birth certificate and other such documents at the time of buying a policy.
Last, but not the least, pay your premium by the due date so that your policy does not lapse. Make use of the 15-30 day grace period for paying the premium, but don't bank on this.
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