An insurance policy is a major tool for safeguarding your family financially against early death, health emergencies and protection of property. It is also used to secure future goals such as retirement as well as children’s education and marriage.

Concealing health conditions can come to haunt you later

Whatever be the need for which an insurance policy is bought, the moment of truth is at the time of claims. The most important document which is referred to at the time of the making a claim is the proposal form that is filled out when applying for the insurance policy. Often, we simply sign the document and leave it to the agent to fill in the details. The agent, not being aware of the health conditions and other important information, tends to fill it based on the best of his knowledge. This may result in omission of key information.

The proposal form is the basis of all insurance contracts and is part of the agreement between the insurer and the insured. It contains the insured’s personal details, her insurance history and information relating to the subject being insured.

One of the most common reasons for claim rejection in life as well as health insurance is non-disclosure of conditions such as hypertension , diabetes, thyroid, surgeries, etc. are the most common reasons for claim rejection. Generally, there is a list of 8-10 medical questions in the proposal form, which need to be read and answered correctly. It is the duty of the proposer – that is, the policyholder - to declare all the information correctly.

We have also seen that life insurance claims are rejected on the basis of non-disclosure of previous policies. So, always make sure that you make a mention all the old policies that you own or may have held at the time of buying the new policy.

Be upfront about your lifestyle habits, income details too

Non-disclosure of lifestyle habits like use of tobacco, smoking, and alcohol can also lead to rejection of claim. Even if you consume any or all of these occasionally, it is best to disclose the same in the proposal form.

Your occupation at the time of applying for the insurance cover is also important and relevant for the insurer. Generally, high-risk occupations are accepted with some loading on the premium – that is, additional premium – but this will ensure that the claim is paid in case of the event for which the protection is bought.

You need to declare correct salary and ITR details while purchasing life insurance covers. If the insurance cover is purchased basis wrong declaration of income, the claim may get rejected.

When hospitalised, do ensure that the history mentioned in the discharge summary is correct because at times, errors committed by the hospital staff can lead to claim rejection. While trying to port a policy, ensure that you declare everything in the proposal form. Don’t assume that the new insurer will have all the details.

When filing the claim, ensure that you inform the insurer immediately after the event. The information can be passed on through a call to the customer care, email or through the company app. Also, check your policy document to see if your mobile number and email ID are correct, as the insurance company will only communicate through the registered mail ID and mobile number. Ensure that you submit all the required documents in one go at the time of claim submission. This will prevent delays in claim processing.

Keep nominee details updated

We have also observed that many people do not check the nominee name on the policy documents. For instance, if the nominee has passed away before the event, the claim settlement could become complicated as the insurer will require the correct details of the legal heir. It is important to review the nominee name – particularly, if the nominee was a family member who has since passed away -- and ensure that the change in nomination is effected in all the documents.

These checks at the time of policy purchase and filing the claim will ensure that the chances of getting the claim settled go up significantly.