Primer. Make sure your claim isn’t rejected

The major test of your insurance coverage comes when you have to lodge a claim. What if your claim is rejected by your insurance company?

Insurance is a contract between the insured and the insurer, and hence, like any other contract, any act that leads to the breach of contract or is not in good faith, will lead to the contract being null and void. Any such breach may lead to full or partial rejection of a claim. There are numerous reasons why this breach happens.

When you purchase an insurance policy, you share some information through the proposal form about your property, vehicle, your lifestyle or past illness history. The information you reveal should be clear and transparent as the final premium will be based on the facts disclosed by you. Any incomplete or wrong information in the proposal, whether intentional or otherwise, may lead to rejection at the time of claim.

Permitting your agent to fill your forms is another common blunder people make while purchasing an insurance policy. Filling forms yourself could avoid any kind of mistake that could create problems later.

Any slip-up from the agent’s side or even a smallest thing overlooked by them can lead to rejection of your claim. If you still want to take your agent’s help, make sure to double check the information before signing and submitting your forms.

It is essential to go through your policy details meticulously, when you receive the final document. In case you notice any error in address, description of property or name and age, you need to inform the insurance company in writing and ensure rectification of the details immediately. In case such change leads to charging of additional premium, ensure the payment is done immediately and the corrected policy document is issued by the insurance company.

Wrong description of property, location or asset may lead to rejection of claim in some cases. Besides, there may be other mistakes in the document like, nominee details or pre-existing illness history etc. Any error in these details may lead to unnecessary complications in the event of a claim.

It is always important to insure the asset for appropriate value for the purpose of insurance, which is the replacement cost of the item in most of cases. There are many add-on benefits available at an additional premium over and above the standard vanilla covers.

You need to evaluate the type of cover required for your vehicle, electronics, building, home contents, personal health or accident. Once you choose an appropriate cover, including additional covers, the chances of deductions under insurance claim or rejecting the claim amount are remote.

Your policy is valid, given you pay your premiums regularly and on time. If you skip paying your premiums or do not renew your policy, it will lapse and your claim will be rejected.

Further, if the premium has been paid by cheque, ensure that sufficient balance is maintained in the account till the cheque is cleared.

In most of theinsurance policies, there is a condition, making it mandatory for the insured to inform the insurance company within a stipulated period.

For instance, in case of health insurance, there is usually a 24 hours to 48 hours window to inform the insurance provider about hospitalisation for the claim to be processed. If the policy states a particular time frame within which you need to make the claim, follow that to avoid any issues in claim settlement later.

The writer is Head - Claims Operations, SBI General Insurance

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