Aug 2nd, 2008 by Kaushik Adhikary
photo credit: irina slutsky
Does every insurer accept all insurance business gracefully? No. In fact insurance companies are much cautious about the suspicious claims. Insurance business runs on certain basic principles that I will discuss in another of my article in future.
Indeed insurance business works because the relatively small amounts of contribution, called ‘premium‘ money from the large numbers of policy-holders, who are unlikely to expose losses or make claims, are paid to few who suffer myriad of losses. Like-wise, life insurance companies are in the opinion that a higher degree of scrutiny of suspicious claims helps keep the cost down for rightful policy holders.
No one, however disagrees about the necessity of being much watchful during the underwriting of potential risks associated with circumspect claims. Who are to blame when someone’s agent fill the form incorrectly? Should we rely on when agent telling ‘You sign here and give me the money. I’ll do the rest.’?’
“Agents are supposed to ask a long list of questions” says Mr.Kunnel, who heads IRDA’s life insurance department. “But because the documentation is so longwinded, they usually just run through the form quickly.”
So, how do you protect your nominee or family when taking an insurance policy? Here are some important tips to consider.
Always Make Sure the Agent is Licensed or Authorized:Every states have their panel of licensed agents. Ask them to prove their identity because there are some fraudulent agents out there in the market who may cheat you.
Always Understand the Policy Wordings and Application Form Thoroughly:Even if the insurance agent fills it for you, read all the answers carefully that are given on behalf of you before endorsing your consent. Even after purchasing your policy, there’s a certain “looking into” period after you receive the policy document. Make sure to double-check if there’s any information that’s inconsistent with what has been explained to you by your agent. If you somehow find out that the conditions as stated in the policy are not in tune to your understanding, you can send the policy back for cancellation.
Always Disclose the Truth Regarding the Material Facts:Many people are under the impression that they’d be rejected by the insurance company if they suffer from an ailment or had been hospitalized in the past. That’s not true. The insurance company, in that case may ask for some special reports for their own protection and can charge a slightly higher premium or may modify the conditions of policy which is much better than the claim being repudiated later on.
Write Down your Age Correctly:Age is the main basis on which the premium is calculated. I had one instance where a claim was once denied to a policy-holder on his father’s death because the father’s age as given in the policy document was only 10 years more than his.
Pay your Premium on Time:If you don’t for a stipulated period, the policy would lapse and it need to be revived by paying your outstanding premium installments with extra charges. But what’s the status of a revived policy? Revival is treated as a fresh contract and if the insured dies within two years of that, it may warrant for an early claim. If you find it hard paying your premiums on time every month, try online payment option through the company’s website or bill payment websites or electronic clearing from your bank account or credit card.
Make a Complaint When you Need:If your claim is denied and you genuinely think it is unfair, then go to the grievance cell of your service providing company for review. If they don’t respond, make a complaint with the insurance ombudsman for your region. If the Ombudsman gives judgment in your favor, the insurance company cannot appeal against that. If the ombudsman rules in favor of the company, you can still approach the consumer or civil courts. But you can’t reverse the procedures that is first file a suit in any court, complain to an ombudsman later.
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