The purpose of life insurance is often addressed using buzz words such as ‘protection’, ‘secure your loved ones’ and ‘safeguard your future’. All of this is true when it comes to understanding life insurance but the moment of truth for any insurance company and its customers is ’Claims’. Insurers take pride in having a high claims settlement ratio and constantly aim at making the claims process easy and convenient for their customers.
Despite this, there is a perception that getting claims settled is a cumbersome task. While insurers settle all genuine claims at the earliest, there are a few measures that customers can take to avoid disputes or repudiation.
Firstly, understand the nature of the policy you are buying, the features and benefits and the premium amount and payment term of the policy. It is important that you pick the appropriate sum assured and tenure based on your current age and financial commitments. Ensure that the sum assured is in line with your income levels and standard of living. Also,make sure the renewal premiums are paid timely and policy is kept in force, as typically claims will not be entertained if the policy has lapsed.
Secondly, insurance contracts are solicited on the principle of ‘Uberrimae Fidei’ (Utmost Good faith), which assumes that customers disclose all material facts accurately at the time of completing the proposal form. At the industry level, a large portion of insurance claims are rejected due to non-disclosure of pre-existing medical conditions or misrepresentation of material facts. Hence, once you have zeroed in on the product you want to buy, disclose all details to the best of your knowledge. Details about income and education, occupation, health (including pre-existing diseases), family history and habits such as smoking and drinking should be shared upfront. If all the material facts are disclosed truthfully, then chances of repudiation of the claim are negligible.
Thirdly, many customers prefer to purchase the policy from an insurance agent (or the relationship manager at the bank), rather than to buy online. While the agent can help you zero down on the policy to be purchased and complete the paperwork, it is advisable to fill the proposal form yourself and/or ensure all the details mentioned in the form are correct.
Finally, to facilitate the processing of claims, do provide the details of nominees and the share of sum assured they are entitled to. If required, you may change the same at any point in the future. Do also keep your family (or a close friend/relative) informed about the insurance policy, sum assured and the process of filing the claim.
In the unfortunate event of death of the life insured, it is important for the nominee/claimant to inform the insurer at the earliest. This can be done by sending an email or calling the customer help line number, with details such as policy number, name, date, place and cause of death. This will help the insurer expedite the claim settlement process.Once the insurer is informed, they will typically ask for the claim form (provided by the insurer) to be filled and submitted along with some documents such as the policy bond, death certificate, as well as the KYC and bank details of the nominees. In case of missing persons or accidental death, a few additional documents would be required.
To sum up, it is important for customers to maintain transparency with their insurer and also understand the terms and conditions of the policy. Insurers strive to settle all genuine claims and pay out the claims expeditiously. At Exide Life, we have just launched ‘Insta Claim’ whereby claims are settled within the same day, if all requisite conditions are met. Getting a claim settled is not a complex process and a few basic checks is all it takes to ensure hassle free claim settlement!