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What is an Insurance Claim?

  3/1/23 8:17 AM

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  3/1/23 8:17 AM   |

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An insurance claim is a formal, written request to the insurance company for the amount insured in the event of an occurrence specified in the insurance policy. An insurance claim is a request for compensation for damages covered by your insurance policy. You have the right to make a claim as an insured or as a nominee because of the premiums paid to the insurer per the terms and conditions of the policy agreement.

The insurer will process and verify the claim after obtaining the necessary documents from the claimant and completing all formalities. After that, upon approval, the insured person or the legally-approved interested party will receive the payment from the insurance company likewise.

Claims may cover several policy types and events, from those for death benefits or  sum assured payouts to the nominees of the life insured to medical reimbursement claims for health insurance policies. Third parties may also file claims on the insured individual's behalf, although in most scenarios, only the listed individuals in the policy can file the same.

The insurance claim enables necessary financial support for the policyholder or the nominees against the policy that premiums were paid for. For those purchasing life insurance, their nominees have to file claims for the death benefits. Those buying health insurance may file claims for medical reimbursements, cashless services at network hospitals, etc. Those buying vehicle insurance can file claims for damages, repairs, and other scenarios.

How to File a Claim? Step-by-Step Process Explained

The procedure of filing a claim usually includes these steps:

  • Firstly, an event must be reported to the insurance company, and it should be covered per the policy.
  • After that, the claim form must be obtained and filled up while providing all necessary documents.
  • The insurance company will verify everything and then process the claim for approval, rejection, or requests for further documentation.
  • In case of approval, the insurance company pays out the claim.
  • The settlement may be in the form of either a regular income or a lump sum payout per the policy's terms and conditions.
  • The claim processing timeline may vary across insurers, hovering between 1-30 working days for life insurance claims. Health and motor insurance claims may need shorter processing timelines or may be processed in real time as well.
  • The claim status may be tracked by the insured person or nominees accordingly.
  • The documents to be included are the original policy document, hospital and medical bills, physician's statement, testing paperwork, and identity and address proof for healthcare claims. Life claims may require the original policy copy, NEFT mandate form, original or attested death certificate copy, death claim application form, identity proof of the nominee, and more. Additional documents may be required as well.

Customers should check the claim settlement ratio (proportion of claims settled to the total claims received) before choosing an insurer, along with the overall claim filing steps and guidelines.

What Documents are Required for Claim Processing?

In the event of a death claim:

The insurer must be notified in writing of the death of the Life Insured and must be furnished with the following papers in order for the insurance company to assess the claim:

  • The original death certificate or an attested copy of it
  • The initial Policy Paper
  • Documents establishing a claimant's right in the absence of a legitimate nomination
  • Any additional information or paperwork requested by the insurer

The following extra documentation is required in cases of accidental and unnatural death:

Copies of:

  • FIR and Panchnama
  • Autopsy Report
  • Any newspaper clippings (if available)
  • Police investigation report
  • Chargesheet (In the case of murder)
  • The driving license of the life insured (If they were driving at the time of death)

To know more about the checklist for documents required to file any claim with Edelweiss Life Insurance, check here.

Ways to Avoid Life Insurance Claim Rejection

Avoiding claim rejections is possible if one follows these steps:

  • Provide accurate and authentic information while buying the policy without concealing any relevant information or making any errors in personal and other details.
  • Check all terms and conditions carefully, including inclusions or exclusions.
  • Always pay premiums before the due date to keep the policy active.
  • Provide the correct nominee details with all necessary documents and update or change the same whenever necessary.

 

Swati Tumar - Travel & Finance Writer

Swati is a Writer in the day and an illustrator at night. Among her interests, she is quite fond of art and all things creative. She often indulges herself in creating doodles, illustrations, and other forms of content. She identifies herself as an avid traveler and shameless foodie.

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