Are you clueless about life insurance claims? Not sure how to get started? Well, you've come to the right place. Here, we'll guide you through everything you need to know about life insurance claims and how to make the process seamless.
What Is A Life Insurance Claim?
Life insurance is a valuable investment that offers financial protection for your loved ones in the event of your unexpected demise.
The benefits provided by a life insurance policy are payable to your nominated beneficiaries. It provides them with the necessary financial support to help them maintain their lifestyle after you're gone.
However, before your beneficiaries can receive the benefits, they need to make a life insurance claim.
A life insurance claim is a request made to the insurance company by the beneficiaries of the policyholder after their death.
Initially, the claimant will need to provide evidence of the policyholder's death and other documents, such as the policy document, to support the claim. The claim will then be assessed by the insurer to ensure that it meets the policy's terms and conditions.
Types Of Life Insurance Claims
1. Maturity Claims In Life Insurance
When a life insurance policy reaches its maturity date, the policyholder receives the payment.
The maturity claim includes the sum assured and any bonuses that the policyholder may be entitled to.
The sum assured is the amount of money that the policyholder will receive upon the maturity of the policy. This amount is predetermined at the time of the policy purchase, and it may vary based on the type of policy chosen.
Additionally, some life insurance policies offer bonuses to the policyholder at the time of maturity.
These bonuses are usually in the form of additional payments or interest on the sum assured.
The amount of bonus received may depend on factors such as the
-Performance of the insurance company
-The duration of the policy
-The policyholder's premium payment history.
2. Death Claims In Life Insurance
If the policyholder passes away during the policy term, the beneficiaries of the policy can make a death claim. The death claim includes the sum assured and any bonuses that the policyholder may be entitled to.
The sum assured is the amount of money that the beneficiaries will receive upon the death of the policyholder.
This amount is predetermined at the time of the policy purchase, and it may vary based on the type of policy chosen.
The death claim is made by submitting a death certificate to the insurer. The insurer will then investigate the claim and verify the authenticity of the death certificate. Once the claim is approved, the beneficiaries will receive the payment.
How Does An Insurance Claim Work?
- Know Your Policy:First things first, read your policy carefully. Don't assume anything by yourself.
- Notify Your Insurance Company:Inform your insurance company about the loss as soon as possible. Delaying the process could result in a delay in receiving your payout.
- File Your Claim:Follow your insurer's instructions for filing a claim. You have to provide all the necessary information and documentation required, including any police or medical reports.
- Wait For Processing:The insurer will investigate the claim to verify its validity.
- Receive The Payout:If your claim is valid, the insurance company will send you a payout. This payment should cover your losses as per your policy.
- Follow Up:If there are any issues or delays in receiving your payment, don't hesitate to follow up with your insurance company. Don't let them hold you back from getting what you deserve.
Note - Insurance claims can be tricky, but don't let that hold you back from getting what you deserve.
What Documents Are Required To Apply for an Insurance Claim?
Are you aware of what documents you need to file a life insurance claim? Here is a step-by-step guide to make the process smoother for you.
Death Claim Documents
- Fill out and sign the claim intimation form completely.
- Provide original policy documents.
- Provide the original death certificate or an attested copy of the death certificate.
- Provide a copy of the ID and address proof of the nominee.
- Provide a copy of the bank passbook along with a canceled cheque from the nominee's personal account.
- Provide copies of identity and age proof of the life insured.
- In case of unnatural deaths, including accidents, murder, suicide, etc., provide copies of the First Information Report, Post Mortem Report, and Panchnama duly attested by police officials.
- In case the member was treated for any illness related to the cause of death, provide a copy of hospitalization documents such as discharge summary and all investigation/diagnosis reports.
Maturity Claim Documents
If you want to file a maturity claim, these are the documents you need.
- Fill out and sign the claim intimation form completely.
- Provide original policy documents
- Provide a copy of the Pan Card of the policyholder.
- Provide a canceled cheque bearing the account number and policyholder's name or a copy of the bank passbook.
- If you are an NRI, provide an NRI declaration.
Why Do Your Insurance Claim Got Denied?
You may think you've got everything covered with your insurance policy, but the truth is, things don't always go as planned.
In fact, there are a number of reasons why your insurance company may reject your claim.
But don't worry, check the reasons here,
- You Lied On Your Application
Sometimes people feel the need to stretch the truth a little when filling out an application. But let me tell you, that is a one-way ticket to getting your claim denied.
Insurance companies have teams of investigators who will dig deep to verify every little detail. So, save yourself the headache and tell the truth from the get-go.
- Your Policy Lapsed
This one is pretty straightforward. If you don't keep up with your premiums, your policy will lapse and you won't be covered. It's as simple as that. So, you have to make sure you're paying those premiums on time and every time.
- The Cause Of Death Isn't Covered
This is where it gets a little tricky. Not all causes of death are covered by life insurance policies.
For example, if the policyholder died while engaging in a high-risk activity that wasn't disclosed on the application, the claim may be denied.
So, it's important to read the fine print and make sure you understand exactly what your policy covers.
- The Beneficiary Isn't Properly Designated
Naming your beneficiary is a crucial step in the life insurance process. If you don't properly designate your beneficiary, your claim may be denied. So, make sure you keep your beneficiary information up-to-date and accurate.
- The Policy Is Too New
Did you know that most life insurance policies have this thing called a "Contestability Period"? This means that for the first two years of the policy, the insurance company has the right to investigate and potentially deny any claims. This is to prevent fraud and make sure everything is on the up and up.