Life is unpredictable, and relying solely on your savings to support your family’s aspirations is not enough. A term insurance plan serves as a financial safety net for your family in case of any unfortunate event. It ensures the financial well-being of your loved ones by offering death benefits as specified in the policy terms. When the policyholder passes away, it’s the responsibility of the beneficiary or nominee to initiate the term insurance claim process. Once the claim is initiated, the insurance company proceeds to verify and settle it. Typically, the entire term insurance claim settlement process is completed within 30 days of filing the claim. In this post, we will discuss the steps to claim a term insurance plan.
Term Insurance Claim Process
Term insurance claims are settled in the following three steps:
Step 1: Inform The Insurance Company
The first and crucial step in the term insurance claim process is to inform the insurance company about the claim. The policy’s beneficiaries or nominees must submit the claim settlement form along with the policyholder’s death certificate and other necessary documents. It’s important to note that you must notify the insurance company within three months or 90 days from the date of the policyholder’s death.
You have two options for submitting the claim form:
Physical Visit: You can visit the insurance company’s branch office in person to submit the claim form and required documents.
Online Submission: Many insurance companies offer the convenience of filling out the claim form online and submitting it electronically. When filling out the form, you will need to provide details such as the policyholder’s name, policy number, date of birth, date of death, cause of death, and place of death.
Step 2: Assessment Of The Claim
After receiving the claim settlement form and supporting documents, the insurance company will commence the assessment of the claim. The submitted documents will be carefully scrutinized, and if any additional information is required, the insurance company may request it. In cases where there is suspicion or uncertainty, the insurer may initiate an investigation to validate the term insurance claim.
Step 3: Claim Settlement
Based on the assessment, the insurance company will make one of two decisions: approval or rejection of the term insurance claim.
Approval: If the claim is approved, the insurer will transfer the sum assured (the policy’s coverage amount) to the bank account of the nominee(s). This ensures that the financial needs of the policyholder’s family are met during a challenging time.
Rejection: In the event of a claim rejection, the insurance company will provide a letter explaining the reasons for the rejection. It is important for the beneficiaries or nominees to thoroughly understand the grounds for rejection to take any necessary actions.
The Insurance Regulatory and Development Authority of India (IRDAI) mandates that insurance companies must settle term insurance claims within 30 days. However, in cases where the claim requires further investigation, the insurance company has up to six months to settle the claim as per IRDAI regulations.
Insurance companies typically conduct further investigations if a claim is made within three years of availing of the term insurance policy. This investigation may involve consulting relevant authorities such as doctors and accident investigation personnel to verify the claim’s authenticity.
Required Documents For Term Insurance Claim Submission
To ensure a smooth term insurance claim process, the following documents need to be submitted:
Claim Form: The nominee must provide accurate information on the claim form, including all requested details.
Death Certificate: The original and attested copy of the death certificate issued by government authorities must be submitted.
Original Policy Documents: The original policy documents provided to the policyholder when availing of the term insurance policy are required for verification.
Identity Proof Documents: The nominees must provide identity proof documents, such as Aadhar card, PAN details, along with passport-sized photos.
Medical Records of the Policyholder: If the policyholder was admitted to a hospital before their demise, details regarding admission, medical treatment, test reports, and death or discharge summaries must be provided. A doctor’s certificate from the last attending doctor is also necessary.
Additional Documents: In cases where the policyholder’s death resulted from an accident or a criminal incident, the First Information Report (FIR), panchnama (a document describing the scene of the incident), and autopsy report need to be submitted.
Conclusion
A term insurance policy is a vital tool for securing your family’s financial future. When considering a term insurance policy, it’s important to choose a reliable insurer, such as Aditya Birla Life Insurance, with a high claim settlement ratio. They offer convenient online processes for term insurance claim settlement, ensuring a hassle-free experience for the policyholder’s beneficiaries.