Insurance is the shield to bad times that comes in one's life. Life insurance protects your life and provides coverage to the family, in the form of after-death benefits. The death benefits are very beneficial to plan future events for the rest of the family left behind.
Are You Sure They Will Get Benefits After Your Death?
The question holds the potential to drive someone mad who has planned and tried to insure and save the comfort of her wife and the future of children. Well, that is possible. We will help you in this journey of dilemma.
How Is It Possible?
All you need to do is avoid all those steps that can lead to life insurance claim rejection in your absence. Make your nominee aware of the insurance you have done. Here we are going to tell you what are the things you need to avoid and focus on. Never give the insurance company an opportunity for a denial of the claim.
What Can Get Your Life Insurance Claim Rejected?
Here are a few essential facts that you should always keep in mind if you have bought or planning to buy a life insurance policy:
1. Have You Filled The Form Yourself?
Mere signing away the documents never helps, rather it can land your family into new problems at the time of claiming the insurance policy. The common things practiced by the policy buyers need to be changed. Simply listening to the agent’s explanation relating policy and signing away the documents is a big mistake.
It is advisable to read the full document yourself carefully, understand the terms and policies and thereafter sign the documents.
2. Nominee Should Not Delay In Claim Filing
Any carelessness and delay in the application of the claim process is a blunder. The insurance company is to be informed about the death of the policyholder at the earliest. Things are to be put into action. The norms of insurance companies mention that it is the insurance company that needs to be intimated first about the death of the insured.
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3. Are You Paying Premiums On Time?
The premium payment should be on time. A non-serious behavior can result in the lapse of the policy and a lapsed policy is not entertained by the insurance company at the time of death claim.
4. Have You Got Ontime Revival?
The policy in case lapsed needs to be revived within the time margin. Failure to this can be a big problem both to the insured and the nominee. If you want your family to gain your after-death benefits then beware of this issue.
5. Does Your Insurer Know About Your Lifestyle Changes?
The lifestyle changes are also to be mentioned to the insurance companies. For instance, a person bought life insurance but he was a non-smoker at that time. But over time, he starts to drink and smoke. So, in this case, things should be updated and clarified to the insurer. The insurance companies provide coverage for smokers also and all you have to do is pay a higher premium in comparison to normal insurance. But, at the end of the day, the after-death benefits prove to be financial support to your family.
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6. Make The Insurer Aware Of The Nature Of Your Job
In case you are employed and you do a risky job like that of a fire extinguisher then you need to mention this before buying a policy to the insurance company.
Failing to this can create problems for you and the nominee might face problems at the time of claiming the death benefits.
7. Is Your Nominee Information Incomplete?
The forms filled should contain the complete name and detailed address of the nominee because at the time of claiming the policy these facts are cross verified by the insurer and if the nominee fails to provide the proof the claim will get rejected.
8. Did You Give False Information In The Application?
Any false information provided to the insurance company about the insured if found fraud and faulty the policy is subjected to cancellations as well as legal action against the policy buyer.
9. Have You Enquired About Contestability Period?
Every insurance company has a contestability period of 1 year to 2 years from the time of buying a policy. If you die under this period then the claim can easily be rejected by the insurance company as your death can be taken planned and suspicious. Death instantly after buying a policy is not entertained by the insurance companies.
10. Do You Have Habit Of Concealing Previous Insurances?
Any policy that you withhold from beforehand should be mentioned to the insurance company in case you want to get your death claim processed for your family. Otherwise, things won’t go smooth as the insurance company would not process any of your claims.
What If Your Claim Is Rejected?
There can be many reasons for the rejection of the claim. The claim process involves many formalities subjected to terms and conditions. These terms and conditions are mandatory for the nominee, failing which your family can have to face denial from the insurer. So, read further and you will get to know what are the other obstacles that can lead to claim rejection.
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Are You Aware Of The Exclusions
Things can be very tough if one has not gone through the exclusions of the life insurance policy. Certain cases are not considered under the policy. Not only is the death of the insured but also the circumstances in which it happened is important.
If you do not know the following exclusions then you are shooting in darkness!
- Suicidal Death: All life insurance does not cover suicidal cases. In the case of linked plans, the nominee receives 100% of the policy funds even if he commits suicide within 12-months os commencement of the policy. Whereas for non-linked plans the nominee gets only 80% percent of the premium and many other formalities are to be done.
So, if policies are not accordingly the life insurance policy can be rejected subjected to terms and conditions.
- Death Under Drunken Driving: No policy covers a death case under drunken driving. If the insurance company finds that the insured was driving under the influence of alcohol and drugs then the claim policy will get rejected.
- Disobedience To Law or Death Under Criminal Activity: Death under any criminal activity is not entertained by the insurance company. The claim is subjected to rejection.
- Loss Of Life In Natural Calamities: Add-on plans are there to cover death under natural calamities like earthquakes, floods, etc but in traditional life insurance it is not included and the claim can be rejected by the insurance company.
- Nominee Involved In Murder: Homicide is also a situation nowadays with an increase in crime. Under this section, if the nominee gets involved in the murder of the insured then he is not subjected to any claim by the insurance company.
- Death Under Adventurous Sports: If you choose for any adventurous sports like bungee jumping, skydiving, and other outdoor sports that are dangerous then always remember that you are not subjected to any claim.
- Terrorism: The insurance policy has a section that mentions that the policyholder can not be covered under any terrorist attack and death due to the same. These are unexpected unaccepted by the insurer.
Such cases are dealt on the humanitarian ground under special request to IRDAI. Generally, insurance companies do not have such procedures.
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Conclusion
Make things go smooth for the easier life of your family, just by abiding with the facts and rules mentioned above. One can prevent their life insurance policy from rejection merely by avoiding minor mistakes. So, not to worry, get a life insurance policy and safeguard your family.