The Buyt Desk
It can be very tough for families to learn that the term insurance that they have been counting on for years to address emergencies has turned out futile. The insurer rejected the claim, giving reasons hard to swallow. When this happens, we start blaming the insurer and the entire service, but is the insurer at fault, or are you accountable for it?
It has come to notice that most of the time, insurance claim rejection happens because of the policyholder’s fault. Policyholders make many mistakes while buying term insurance that lands them in such a situation. Learn from the 5 mistakes that can lead to insurance rejection.
1. Concealment of Information
Despite having numerous terms and conditions, term insurance plans are an integral part of your financial planning. It can come to your rescue when financial assistance is needed the most. But your carelessness can put you in trouble. The most common mistake people make while buying a policy is that they get casual in providing relevant information to the insurer. Never do this!
Always be proactive in asking questions and providing information about your lifestyle, habits, health, etc. If you provide wrong information or if the provided information happens to be false, the insurance company has the right to reject your claim.
2. Non-payment of Premium
Timely payment of premiums is very important. Never postpone premium payment to the next date or month; otherwise, your policy will lapse, and a lapsed policy is unclaimable. Insurance companies give some grace period to pay the premium, which varies from insurer to insurer, but on average, it remains between ten to fifteen days. Do not cross your premium due date.
3. Death Due to Excluded Clause
Excluded clauses are conditions that insurers do not entertain. If the policyholder happens to die because of any excluded clause, the insurer will not accept the claim. The best thing to do in this case is to carefully read the terms and conditions of insurance before taking it.
4. Non-Disclosure of Hazardous Activities
If you enjoy adventure and engage in hazardous activities, you should pick the insurance policy accordingly. However, if you have chosen the wrong insurance and happen to meet with an accident, the insurer might reject your claim.
5. Providing Wrong Information
If you provide false or misleading information about your health while applying for a policy, your claim might get rejected. For instance, if you have mentioned in detail that you don’t smoke, but later on, if the insurance company finds out you are a smoker, they may reject your claim.
Conclusion: Term insurance protects families in times of emergency, and nothing is better than it. However, to avail of all its benefits, one must comply with the policy terms and conditions and provide accurate and relevant information while buying the policy.
