New Delhi: According to information from the Insurance Regulatory and Development Authority of India’s annual report for the fiscal years 2020–21, 10.84 lakh individual life insurance policies received death benefits from insurers, compared to 11.01 lakh claims. There were 9,527 claims that were rejected after being reviewed because they were determined to be unpayable, totaling Rs 865 crore. There were also 3032 death claims that were denied, costing Rs 60 million. At the conclusion of 2020–21, there were 3055 claims pending, totaling Rs 623 crore.
In 2020–21, LIC’s claim settlement ratio increased to 98.62% from 96.69% in 2019–20, and the percentage of claims repudiated or rejected decreased to 1% from 1.09% in 2019–20. Private insurers’ claim settlement ratio decreased from 97.18% in 2019–20 to 97.02% in 2020–21.
How can you prevent your insurance claim from being rejected?
Give out all the details
Be truthful and accurate when providing information in the proposal form about your health and medical issues, family history, occupation, income, current insurance, and lifestyle choices (online or the physical one). Filling out the form yourself is preferred. Taking into account all the disclosures, the insurance company will set the rate. Carefully review the insurance document, and report any errors to the insurer.
For those over 45, insurers mandate a medical exam before issuing a new life insurance policy. According to experts, even children under that age should insist on a medical exam to understand their medical status and enable them to seek treatment and early diagnosis of disorders. You must notify the insurer as soon as possible if you become ill after the insurance has been issued.
Pay premium on time
To prevent the coverage from expiring, it’s crucial to pay the renewal premiums on time. Insurance companies offer a grace period of 15 days for monthly payments and 30 days for quarterly, half-yearly, or annual premium payments if the premium is not paid by the due date. During the grace period, the policy is still in effect, and the nominee is qualified to receive benefits. Although there is a grace period, if the premium is not paid during that time the insurance expires and all benefits are no longer covered.