How to Claim Term Insurance After Death?

How To Claim Term Insurance After Death?

The claim process begins after the death of the policyholder, allowing the nominee or claimant to receive the death benefit. Understanding how term insurance works is essential, as it helps in following the correct steps for a smooth and timely claim settlement.

1. Intimation of Claim

   After the policyholder passes away, the nominee can initiate the term insurance claim settlement process by filling out the Death Claim Form. This form can be submitted directly to the head office, bank branches, or nearest offices or sent via email to the insurer. Along with the form, the nominee needs to provide attested proof of identification and address. The Death Claim Form is available both online on the company’s website and offline at branch offices.

2. Document Submission 

   The nominee or claimant must submit the necessary documents along with the form to confirm the details provided to the insurance company about the policyholder's death. These documents should be provided within the given timeframe. You can understand the list of documents required to be submitted to the insurer from the below table:

   Death Types	Documents Required
   Mandatory Documents	Original documents of the policy Death Claim Form Cancelled Cheque with NEFT details Nominee/Claimant’s ID and Address Proof
   Additional Documents Required:
   In case of Medical//Natural deaths	Consulted Doctor’s Statement  Certificate of the hospital treating the deceased policyholder Employer Certificate or Educational Institute Certificate of Policyholder Additional treatment/hospital/ records
   In case of accidental/unnatural deaths	Police Reports (Panchnama, FIR, Police Investigation Report, Charge sheet) Autopsy/Post Mortem report (PMR) and Viscera Report

3. Settlement of Claim

   When the company receives all required documents and forms, the claim process starts being processed. The company checks and verifies the documents in accordance with the requirements, makes a decision (subject to T&C), and finally, communicates the same to the nominee/claimant.

   The Insurance Regulatory and Development Authority of India, aka the IRDAI, requires all insurers to pay death claims within 30 calendar days. The duration begins from the date that the nominee of the policyholder submits all required documents and clarification.
   The insurer can conduct an additional investigation if there is a need to do so within 60-90 days after receiving the claim notification. If the claim cannot be settled within 30 days, the Insurer will have to pay penal interest.
   *Note: You can also go to their website and download the term insurance claim form.

What are the Different Types of Claims?

As you have understood how to claim term life insurance. Let’s understand the different types of claims available in India:

• Maturity Benefit Claim: The maturity benefit claim is applicable where the policyholder outlives the policy term and the maturity benefit is payable as per the policy documents. In term insurance, maturity benefit often refers to the return of premiums applicable with term insurance with return of premium plans, that pays the entire premiums paid towards the policy back at the end of the policy tenure. You can learn about how to claim term life insurance return of premium for different insurers in the policy documents.

• Death Benefit Claim: The death benefit claim can be made by the nominee of the policy on the death of the policyholder during the policy term. The nominee/family can get in touch with the insurer or with Policybazaar representatives (if purchased via Policybazaar) to initiate the term insurance claim process. After informing the insurer, the nominee needs to fill out the claims form, attach the required documents, and, on successful verification, the claim amount will be disbursed into the nominee’s bank.

• Rider Benefit Claim: The term insurance riders can be claimed in policies that have an additional rider benefit added to the base term plan. Riders like accidental death benefit, accidental total and permanent disability benefit, terminal illness benefit, critical illness benefit, and hospicare benefits can enhance the base cover of your policy and pay an additional benefit amount on top of your base sum assured. You can learn more about how to claim term life insurance riders in the policy documents, as they differ from insurer to insurer.

What Are Some Factors To Consider Before Claiming Death Benefit?

You must know all the details about claiming the death benefit and make sure you understand the following factors before filing the claim:

• Reason for Policyholder’s death is covered under the plan: Check that the reason for the policyholder's passing was not exempted from the term policy before you file a claim. An exclusion could include death from a pre-existing condition, death from alcohol or drug abuse, and any hazardous activities.

• Policy is still active at the time of death: A term insurance claim may be denied if the policyholder is not aware of its expiry or if he/she forgot to pay the premiums on time, leading to a policy lapse.

• All information/details provided match the documents submitted: You must ensure that your claim form and the information in the term policy documents are accurate. You should carefully check these details as if they do not match your claim, you may be charged with fraud, and the claim will be denied.

*Note: You should firstly understand what is term insurance and then buy the right term plan to avoid rejection of your claims.

What Are Some Important Conditions In Term Insurance Claim Process?

The nominees must understand the inclusions and exclusions of insurance policies before they can begin the claim process. 

• The term plan covers death benefits for both natural and unnatural causes. Depending on the cause, certain clauses may be applicable. 

• For instance, only a few insurance companies pay the suicide death benefit or return the premium for deaths that occur within one year of the policy's initiation. The majority of insurers only return a small percentage of the premium.

• The Insurance industry operates on risk assessment. The policyholder's risk level determines the death benefit. High-risk policyholders, such as those who smoke or drink alcohol, receive different benefits than those who don't have such a habit. Each insurance company has its own rules, and they differ from other insurers. You can calculate the premiums applicable for the suitable term plan cover using the term insurance calculator available online. 

• Checking the policy document is the best way to find out about specific exclusions and inclusions for the policyholder's term plan. To obtain the information, the nominee can also contact the insurer's customer service line. Once the nominee has the information, he/she can proceed towards claiming the amount accordingly.

How To Ensure Smooth Term Insurance Claim Process?

Online term plans allow you to easily manage your policy and submit a claim in a couple of minutes. To ensure your claim is approved, you need to take certain steps. If you are the policyholder, educating your family and yourself about the claims process is important. 

Unfortunately, you won't be there when the insurance claim is filed. You should inform your nominees about all information regarding the policy. This includes details about the policy, including the claim process, sum assured terms and conditions, and any other aspects.

It is also crucial to mention any add-on riders with the nominee and educate them about the same. The last thing you would want is your family denied any benefits because they didn't know it existed in the first place.

Wrapping it Up!

Filing a term insurance claim after the policyholder's unfortunate demise requires the nominee to have full information about the process. Improperly filled applications or missing steps can lead to claim rejection and cause the nominee to be booked for fraud. So, ensure you properly understand how to claim term Insurance after death and take the right steps to claim their policyholder's sum assured.

Note: Check all the best term insurance plan in India.

Note: You should also check the benefits of term life insurance if you are planning to purchase the term insurance plan.

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