How to Overcome Delays in Claim Settlement

  • 16th Dec, 2013

The moment when a claim on a life insurance policy needs to be made is usually a sensitive one. At such times then, the last of one’s worries should be a delay in the time taken to receive the claim amount. Life insurance usually has 3 types of claims that may be made. They are- Death claims, Maturity claims, and Claim on Riders. While death claims are evidently made at a grievous time in a person’s life, the other claims may arise either upon maturity of your policy, or during the unfortunate occurrence in case of riders. Given ahead are some of the reasons that could lead to a delay in the claim settlement procedure in any of the aforementioned situations.

Ways to avoid a delayed claim settlement

The two most likely points at which there could be any discrepancy that could further lead to a delayed claim settlement are- the buying stage and the claims stage. Any inconsistency in provision of details at either of these times could be a major factor which contributes to a delayed claim settlement. However, there are ways that this can be prevented. Some of the most effective ways in which you can avoid a delay in your claim settlement are as given below.

Share complete information: One of the most common reasons due to which there could be a delay in claim settlement is sharing of either wrong or incomplete information. This can be an obstacle as either of the situations could mean not only delayed contact from the insurer, but at times could completely restrict contact by the insurer too. Additionally, what could also hinder the process is forgetting to share updated information such as your mailing details, contact number, or any other essential contact details. In such cases, it is therefore advisable that upon receiving the policy bond from your insurer you check and verify the authenticity of all details provided on the document.

Avoid non-disclosure of information: Aside from giving wrong or incomplete information on the proposal form, non-disclosure of information is also a common reason that could delay the claim. At the proposal stage, ensure that you disclose all the details such as health status, occupation, habits, physical disabilities, other insurance policy details, and so on. Making sure that you have all such details in place would reduce the chance of conflict at the claims stage.

Mention a nominee: When filling your proposal form, make sure to mention the name of the nominee(s) in your policy form. Besides that, it is equally important that your family members are also aware about the policy, as this will allow them to make a quick claim, if and when required. In situations where the nominee may have passed away before the policyholder, ensure that the details have been updated, and revised nominee details are provided.

Provide authentic documents: In order to ensure a timely settlement of claims, it is crucial that all the documents submitted are authentic. Detection of any false or fabricated documentation could lead to the possibility of a rejection of claims, rather than a delayed settlement. For assessment of few living benefit claims such as critical illness benefit, insurers would also require case management reports/ hospital treatment notes, etc., and hospitals require authorization to share these documents with the insurer. It is advisable that claimants provide this authorization while filing claim, as this would facilitate the insurer to obtain the documents for faster assessment of the claim.

Make a timely intimation to the insurer: In order to have a speedy claim settlement, it is advisable that all claims’ intimations are made within time frame specified by the insurer in the policy document. It is also advisable that the submission of claim documents is done within the same time frame as this will make the entire claim settlement procedure a faster and more seamless one.

In addition to the above mentioned, also make sure that you look into other aspects such as the claim settlement history of your insurer. Usually, getting an idea of their record for the last 5 years should leave you in the position to judge their overall claim settlement ratio, as well as their turnaround time.

Many life insurance companies today are working towards streamlining all claims related procedures to make them as seamless as possible, so that customers have to face no issues when making a claim. In addition to that, they are also offering customers the option of staying updated regarding the status of their claim by means of real time data which could easily be accessed on the company website. Besides that, with the option of online transactions these days, it is also advisable that you opt for an electronic payment of the claim amount, as this would not only be a quicker form of the transaction, but a hassle-free one too.

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