With life and situations becoming unpredictable, it is important to have a financial cover for your family in the event of your sudden death. The pandemic has made people realize the importance of this, and more and more people are insuring their lives. But, it can be frustrating when the claim to life insurance is not accepted by the insurer. Read on to find out some of the central aspects that you must follow to avoid life insurance claim rejection.
7 Guidelines to Prevent Life Insurance Claim Rejection
Do not Hide or Leave Out Information
When you fill in the application form, do not leave out any information. It is essential that the insurer knows everything about you. Avoid missing or omitting information unknowingly. The insurance premium is fixed based on crucial details, such as age, occupation, policies you hold, your health, way of life, and so on. Some people cover up information in order to lower the premium amount, but they ultimately face issues later. Their claim may get dismissed. Claim rejection deprives the dependants of the benefits of insurance. Also, sometimes, you may give erroneous information by mistake, or the company could have put in the wrong details. So, once you get the policy documents, it is crucial to conduct a thorough check to delete errors from the insurance company’s as well as from your side.
Pay Your Premiums on Time
Your policy will lapse if you do not pay your premiums on time. Once your policy lapses, you are no longer covered, and the premium amounts paid so far will be a waste. They will not be returned. Claims made after the lapse of the policy will be dismissed by the Insurer. Although the company will send you notices about the due dates for premium payment, it is always better to set your own reminders. You have the right to know if the insurance company has sent you notices to remind you about the due dates and warn you about policy lapses.
Keep the Nominee Information Updated
On your demise, the benefits are directly given to the nominee. So, you should update the insurance company about the details of the beneficiary, such as address, phone number, email ids, etc. Also, if the already nominated person dies, then change the nominee. If you are unmarried, you may naturally nominate your parents. But, once you get married, it is good to nominate your spouse.
Do Not Postpone the Filing of Claims
If there is a medical emergency, then the insurance company should be notified immediately. You can give the insurance company’s phone number to a trusted colleague, relative, or friend and ask them to contact the company in case of an emergency. As per the insurance agreement, critical situations should be reported immediately to the company. Also, companies may suspect foul play in case of delayed reporting or failure to do so. So, the claim may be rejected. Be fully aware of the method to file claims, so that time is not lost in filing them.
Self Form Filling is Most Viable
Most people trust their agents to fill up insurance forms. This may result in erroneous details and omissions. Agents may not be able to understand the more intricate details about you, such as your medical history. They fill up forms to meet sales targets and may omit information, such as alcohol and tobacco consumption. These could become issues if the reason for your hospitalization in the future is traced to such habits. So, sit with the agent and fill-up the form. This way you will also be complying with the rules of the insurance company. Last but not the least, only you know yourself best.
Cooperate With Medical Tests
Insurance companies may conduct medical tests to know about the health status of the insured. Some people avoid these tests, but it is good to take this. Insurance claims may get denied due to prior diseases, and medical examination can avoid life insurance claim rejection due to pre-existing maladies. Also, you can take treatment for the health issues identified during the medical inspection and cure them.
Examine the Policy Documents Meticulously
As soon as you get the policy documents, check the details mentioned there. Intimate the insurance company about wrong information and ensure that it gets corrected. To establish the claim, the nominee has to furnish these imperative documents.
Exceptional Circumstances Under Which The Insurance Claim Will Be Rejected
Every insurer lists some exceptions under which the nominee cannot claim the insurance amount, such as your death due to suicide, due to overdose of drugs, due to intoxication, and so on. In these cases, it is not possible to avoid life insurance claim rejection.
Although there is no replacement for the death of a person, financial help during those times can be greatly relieving. That is why ensuring your life is essential. Equally essential is reaping the benefits of the insurance by procuring the money on claiming it. Claim rejection can be prevented if caution and alertness are exercised. Stay updated with the details concerning your insurance policy and be in constant touch with the company as well.
FAQS Avoid Life Insurance Claim Rejection
1:What can be the most crucial reasons for the dismissal of your life insurance claim?
Well, the most vital reasons could be
- death due to drug, alcohol, or tobacco addiction
- Fatalities due to accidents resulting from breach of conduct, such as drunken driving
- Medical billing errors
- Claims not made and filed on time
- False information on the insurance documents
2:Can you reopen a denied insurance claim?
You can reopen a denied insurance claim, however, the process must be followed meticulously. Otherwise, you will get it closed permanently.
3:How long does it take for a LIC death claim?
Insurers should settle death claims within 30 days as per the time limits set by the Insurance Regulatory and Development Authority (IRDA) of India.