Understanding Term Insurance Claim Settlement

Closer home, India has witnessed almost eight million people get infected by the virus, the second highest number of cases in the world after the United States of America with ~ 1.2 lakh deaths. Even though the curve of new infections seems to be flattening, the total number of cases is still on the rise. Moreover, the possibility of a second wave cannot be overlooked given what is happening in the Western countries.

While having term insurance is in itself a necessity, especially if you are the sole earning member of the family and have dependents, the prevailing situation makes it even more crucial. With COVID-19 increasing the risk of something unfortunate happening, it is of paramount importance to secure the wellbeing of your family by having a backup plan for such an eventuality. A term insurance plan just provides that backup.

Term Insurance Claim Rules

No matter how much detail you plan a safe future for your family, if they are not aware of how to make a claim under the term insurance plan, they may still struggle. Many individuals are not aware of an insurance claim process. Due to lack of this knowledge, many individuals are misled by incorrect or incomplete information and develop a wrong notion about insurance fearing that claims are not fulfilled by insurance companies. Since the beneficiary would still be recovering from the loss of losing a loved one, term or other policies usually have a seamless process with no hassles or difficulties. Here is what you need to know about making a term insurance claim:

• Any claim under a life insurance policy is always raised by the nominee chosen by the policyholder - could be the wife, husband, offspring, sibling or even parents. Since the claim is filed after the life assured’s death, it is obvious that he or she will not be around to guide the beneficiary.
• First and foremost, the beneficiary needs to inform the insurer about the death of the life assured. This should be done as soon as possible as it would ensure speedy processing of the claim. With insurers like Bajaj Allianz Life Insurance, you can even download the claim form online on their website without making a visit to their branch.
• While filling out the claim form, be it in physical form or digitally, you may need some documents, which you should keep handy. These mainly include the life assured’s death certificate and the original term insurance policy documents.
• After you file the claim form, the insurer may conduct their own personal investigation to ascertain the circumstances of death. This normally happens if the life assured dies within three years of policy being issued. You may have to provide a copy of the FIR and post mortem report if the life assured died an unnatural death.
• From the date that the beneficiary submits all the details and documents along with the claim form, the death claim has to be issued within 30 days by the insurer as mandated by the Insurance Regulatory and Development Authority of India (IRDAI). If the insurer takes more time, it would have to pay penal interest on the claim amount to the beneficiary. 
• However, if there is a need for further investigation, in that case the insurer can take another 60-90 days for the same.

One important thing to note is that some circumstances are excluded and may result in rejection of the claim. Therefore, it is important to read the policy document carefully before making any claim. For example, exclusions could include suicide as the cause of death.

Conclusion

So in these uncertain times, bring some security to your life by opting for a term life insurance plan. Since among other life insurance products, term insurance offers higher life coverage for the same amount of premium, you can be rest assured that your family would have enough money not only to make ends meet, but also to have a good and stable life.

Also read: Term Insurance Claim Settlement Process Explained

Importance Of Claim Settlement Ratio

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.