The Buyt Desk
An insurance is a protection cover for unexpected circumstances. A life insurance is brought to secure the family financially if there is a sudden demise of the income earner of the family. To meet unexpected health expenses there is health insurance which helps you be prepared for a health emergency. The aim of both the insurance is to help you and your family during difficult times. But if you overlook or do not furnish correct information chances are that you may lose the claim benefit. An insurance plan is subject to the insured person’s age, lifestyle habits, medical history, occupation and income. Below are the things to be taken care of so that your claim is not rejected.
Grounds of Rejection For Health Claims
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Disclose all existing Insurance Policies – Most of the people buy more than one insurance policies. And it is necessary to declare all the existing policies brought by a person to the new company in the application form. Few do it purposefully thinking they are fooling the insurer and few do not pay much attention to it and miss furnishing the details. But insurance companies are very particular about the policy related rules and regulations and it is absolutely necessary to declare your prior insurance policies.
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Never lie or withhold any information – It is a very common ground which is used by companies to reject a claim. That is why it is very important that you do not hide any previous or hereditary illness, any risky hobbies, or current health conditions. Disclose everything about your health condition clearly.
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Never give incorrect information – It is the duty of the person buying insurance to reveal all the necessary information to the insurance company. If there is no transparency then the application or claim is sure to be rejected. Always give real information when asked for regarding age, weight, income, occupation, height and any other details.
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Always take medical tests when asked for – Policy approval is based on the risk assessment by the underwriter, who accesses the information provided in the application form. Higher the sum assured, more are the medical tests to be undergone. If these tests are not taken then a claim rejection would happen.
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Chronic illness – If the person has developed chronic illness at the time of application, the chances of application rejection is more. Anxiety or depression, Asthma, Cancer, Diabetes, Heart disease, High blood pressure, High cholesterol, HIV and AIDS, Obesity, Parkinson’s disease are common health conditions that could cause a denial or higher premiums.
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Always disclose medical history – Giving wrong medical history details in the application form and then getting caught after medical tests will attract rejection of the application form.
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Hazardous Occupation – Insurance companies are unwilling to approve policies of people with jobs that have a higher degree of risk and danger like pilots, flight engineers, construction laborers, miners, electrical power-line installers and repairers.
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Risky passion and hobbies – Insurance companies are reluctant to approve policies of people with hobbies that have a higher degree of risk and danger activities like mountaineering, scuba divers, base jumping, rock climbing and other adventure sports.
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Income Limitations – Person applying should fit in the economic or income criteria of the insurance company. Applications of people with income below the necessary level will be denied.
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Life Insurance applications rejected previously – If the application is rejected previously by some insurance company then probability of rejection by new insurance company is more.
Why Would Your Term Insurance Claim Get Rejected ?
Death of the breadwinner of the family will financially impact the family apart from emotionally. Term insurance plan is the safety net that a policyholder provides for the family. Claiming insurance on deposits of policyholders and receiving the insurance benefit in the form of a large fund will help the beneficiary to pay off any outstanding debts and support the family of the policyholder. All the effort of the policyholder will go in vain if the claim is rejected. Here are various reasons for rejection of term insurance claims –
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False information – Hiding lifestyle habits at the time of buying life insurance like smoking and drinking or providing wrong information regarding age, weight, and inflated annual income may be reasons for claim rejection. With honest declarations in application form, the beneficiary may not have to deal with claim rejections.
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Not paying premiums on time – If the premium is not paid on time, the insurance company considers the term insurance policy as lapsed. And one cannot claim the lapsed policy.
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Incorrect nominee details – Insurance companies may deny a claim when there are no nominee details filled or updated in the application. If the nominee is dead too, then none can claim it.
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Policy is still in contestability period – Insurance companies usually have one or two years as contestability period immediately after buying a policy. In this window, the insurance agency can investigate and possibly deny claims. If a policy holder dies within this period then chances of rejection of claim is high.
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Cause of death – There are various types of deaths that are not covered under the insurance policy of the company. Death in hazardous activities or sports, death due to a pre-existing health condition, homicides, suicides, death due to natural disasters and terrorist attacks are usually not covered by term insurance policies.
Summing up
It is always better to be safe than sorry. All the premiums paid should not go in vain. Be honest and transparent while buying insurance. Be sure that you have disclosed all the important details to your agent so that you do not end up in huge trouble later. Be very cautious and alert while signing up for the term insurance and give out all details needed by the insurance company.
