Why is your term insurance claim rejected?

Term insurance is considered as one of the best life insurance plans. The scheme provides financial assistance to the nominee on the death of the insured during the term of the policy, enabling the family to live with financial stability in future. But if the insurance claim of the nominee is rejected, then what is the benefit of taking your policy. Also, because of not getting the money, you can understand the trouble they will face in future. Claims are generally not dismissed. Some mistakes and negligence of the policyholder cause the claim to be dismissed. So through this article we are going to tell you why your claim is rejected, so that you can avoid this situation.

Why your term insurance claim gets rejected?

There are several reasons for term insurance claims to be dismissed. Whose information is given below –

Giving or hiding false information – Not giving complete information about yourself while taking the policy is the main reason for rejection of the claim in most cases. When purchasing a term insurance policy, the applicant should disclose their lifestyle habits, smoking habits, age, profession, medical condition, pre-existing illness and all other important facts. It may be that your premium is increased due to the disclosure of facts, but this claim is better than the denial.

If the insurance company feels that you have not been informed of all the facts, then the insurance company verifies this. If any information is found hidden in the company’s investigation, the company rejects your claim. In order to be aware, responsible and responsible to you, you should fill all the necessary details about yourself properly to avoid the claim being rejected in the policy form. Do not give any false information in the form nor hide any information.

Policy lapses – If you do not renew the policy on time, it lapse, ie it is not valid, it is closed. You cannot claim once the policy lapse. The main reason for policy lapses is non-payment of premium on due dates. If you are unable to pay the premium on the due date for some reason, insurance companies also provide a grace period. A grace period of 15 days is available from the due date. If you are unable to pay the premium even during this period, the policy lapse. Claims are settled at the commencement of the policy as per the rules of insurance companies. Therefore, pay the premium of the policy on time.

If the nominee is not mentioned or his details are not updated – When purchasing a policy, most youth usually nominate their parents in the policy. If the nominee dies due to some reason and you do not nominate anyone else, then the claim may be rejected. Because in the absence of a nominee, the company is unable to decide to whom the sum insured is given. Therefore, the insurance holder is advised to keep updating the policy and mention the nominee if circumstances change.

On not having medical test – The applicant is asked to undergo a medical test before the insurance company purchases the plan. With this, the insurance company gets to know your health and based on this, the premium and other conditions are decided. If the applicant already has a disease or is intoxicated, then in this case a higher premium is charged. Sometimes the applicant does not conduct medical tests to avoid higher premiums, although some insurance companies offer policies without medical tests till a certain age, but it is good to get the test done. It is always beneficial to opt for a medical test. This will make you aware of your health status and the insurance company will get all the information about you, which will also reduce the chances of rejection of the claim. The insurance company bears the cost of the medical test.

Claims are rejected even in these situations

There are some conditions and exceptions to insurance plans. Insurance companies do not provide cover for these exceptions. Some exceptions are given below. In these cases, death is not covered.

  • Insurance companies do not provide cover for death caused by injury to the insured, death due to vaginal diseases or natural disasters etc. The claim is dismissed in this standing.
  • Deaths from war, terrorist attacks or participation in adventure sports are also excluded from cover. There is no cover even in this situation.
  • If the insured is killed and if the nominee is legally found guilty, the claim is also dismissed.