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Ease of settlement

Making a claim on a life cover need not be a daunting process for women. Here's how.

Print Edition: February 19, 2009

Life insurance policy is a legal contract between the insurance company and the insured, where the former agrees to pay a pre-defined sum to the nominee on the death of the insured. However, making a claim on a life cover is not necessarily the happiest of tasks, and for women, it's especially daunting. Even for a survival claim, particularly on moneyback policies, though the amount reaches the beneficiary automatically, at times the procedure is cumbersome because of the documentation required.

Women often face problems in a survival claim because they tend to change their names after marriage but fail to inform the insurer. So the benefits dispatched by the insurance company are not cleared by banks because the policy document is still in the maiden name. Subsequently, the policyholder is required to make a fresh claim and provide the requisite documents.

In case of the death of the insured, a basic procedure needs to be followed to make a claim and get the proceeds. As a first step, the nominee needs to submit a claim form, which varies across insurers. The form must be complete and the details demanded must be provided. The nominee also needs to submit the original policy document, attested copies of the death certificate, and if it is a medical or legal case, the requisite medical and policy reports. The nominee also has to furnish the proof of his own identity before the claim can be settled.

Unlike policy servicing, which is handled by agents, claims are settled directly by the insurance company once it finds the documentation satisfactory. So women should be wary of any person who tries to facilitate or help in the claims process.

After the necessary forms and documents are submitted, the insurer takes between 10 days and two weeks to verify them and can ask for more documentation, if needed. The Insurance Regulatory and Development Authority (Irda) has stipulated that claims be settled within 30 days of the receipt of the relevant documents. However, the insurer can ask for clarifications or supporting documents if the submitted documents are not satisfactory. For instance, in case of death due to medical reasons, the insurer can seek details on the insured's health and past medical history.

Even in cases where the insurer seeks additional details, the claim has to be settled within six months from the date of intimation of the claim. If the insurer fails to meet the deadline, he has to pay an interest on the sum assured. The nominee can also approach the ombudsman if the insurer fails to pay the claim on time.

Documents needed for a quick and error-free settlement of claim, the nominee needs to submit the following papers to the insurance company:

  1. Policy document
  2. A copy of death certificate.
  3. A copy of photo identify proof of the claimant such as the passport, PAN card, election card or the driving licence.
  4. A copy of proof of current residence in the name of the claimant such as the electricity bill, telephone bill, ration card, passport or election card.
  5. A filled claim form, along with bank account details.
  6. Insurers can demand more documentation if the death is after a prolonged illness and hospitalisation or required police intervention.

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