Term Insurance Claim: Process & Settlement Ratio

Term Insurance Claim

A term insurance claim is filed by the policy beneficiary to the insurance company in order to avail the death benefit in case of the policyholder’s unfortunate demise. A majority of insurance companies offer a seamless claim processing facility so that the beneficiary can file claim and avail insurance coverage seamlessly.

Term Insurance Claim Process

There are many different steps involved while filing a claim on a term insurance plan. In case of unfortunate death of the insurance holder, the dependents (family members) or beneficiary under the term insurance policy should inform the insurer as soon as possible. In order to support the claim filed, it is necessary to submit all the required documents. However, prior to intimating the insurance company, the beneficiary should keep in mind some important facts.

The insurance policy should be in force and all the premiums should be paid dully.
The specific situation for which the claim is filed should be covered under the term insurance.
Policy exclusion.

Step by Step Process of Term Insurance Claim Settlement

Inform the Insurance Provider About the Claim

In order to enable the insurer to start the process of claim, the nominee should inform the insurance company as soon as possible. The required details for the intimation of claim are the name of the policyholder, policy number, date of birth of the insured, place of death, the cause of death, the name of the beneficiary, etc. The beneficiary can avail the claim form either from the nearest branch of the insurance company or can even download it from the website of the insurance company. Moreover, the beneficiary can also fill the form online and file the claim.

Documents Required

The documents that should be kept handy while filing the claim are:

Death certificate
Age of the policyholder
Original documents of policy
Any other documents according to case related or according to the requirement of the particular insurance company

If a claim is made within the 3years of policy issued, the insurer does an additional investigation in order to ensure it is a genuine claim. These are as following:

Check with the hospital whether the demised person was admitted in the hospital or not.
In case of confirmation of flight crash from the airline authorities, the insurer checks with the airlines that whether the insurance holder was the passenger of the flight or not.
In the case of death of the insured due to any critical illness, the insurance provider will ask the hospital to make available the details like medical records, doctor’s certificate, etc.

In case the insurance holder dies due to suicide, murder or accident then panchanama, police FIR report and post mortem report will be required.

Submission of all the Important Documents for the Processing of Claim

The beneficiary should submit all the required documents as early as possible to speed up the claim process and avoid
any delay.

Settlement of Claim

According to the Insurance Regulatory and Development Authority (IRDA) of India, it is mandatory for all the insurance companies to settle the claim within 30 days. The claim should be settled by the insurer from the date the beneficiary submits the claim form along with all the required documents. In case, the claim requires additional investigation then the insurer is obligated to complete the process within 6 months from the date of receiving the written intimation of the claim.

Important Inclusion and Exclusion

Term insurance coverage is applicable to both unnatural and natural death. In the case of suicide, the claim is settled after one year of taking the policy. Inclusion and exclusion of the policy depend upon the risk factor of the policyholder. Thus, the benefit of non-smokers will be different in comparison to that of smokers. However, most of the benefits offered by term insurance plan remain the same in the different plan the term of coverage varies from plan to plan.

Documents Required for Term Insurance Claim Submission

Thoroughly filled claim form ( provided by the insurer)

Death certificate (original and attested copy issued by local municipal authority)

Original policy documents

Deeds of re-assignments/assignments if any

Photo of the nominee, ID proof like PAN card, Aadhar card, passport, etc.

Last medical attendant physician certificate

Medical records (admission notes, death/ discharge summary, test report, etc.)

Post-mortem report, if any