While purchasing a new insurance policy most of the people look for the claim settlement history of the insurance company. As it is is considered to be a parameter for the selection of insurance company – lower the number of insurance claim rejections of the insurance company the better it is for you. But have you ever bothered to know what are the reasons for the rejection of claims by insurance companies and how you can avoid rejection of insurance claim?
While buying a life insurance policy most of us try to keep our sum insured higher to secure our family from any financial burden in case of our death. But it is equally important for us to ensure that we have met all the formalities and terms of the insurance company so that the sum insured of your life insurance policy will be paid to your family after your death without any difficulty.
As in most of the cases of rejection of insurance claim, either insurer are not known to the terms of the insurance company or stay ignorant which make all your efforts and premiums to null. Here we are talking about a very important and compulsory term of the insurance companies i.e the disclosure of details at the time of buying new insurance policy. Here disclosure of information includes your personal details, medical history, financial details and details of your existing insurance policies. According to the compulsory term of the insurance companies, insured should disclose all his/her policies while buying new. Non disclosure of old policy details can be a reason of rejection of claim on your policy.
Example Of Claim Rejection In Case Of Non Disclosure Of Old Insurance Policies To New Insurer
Here for instance, Mr. A, bought a life insurance policy from XYZ co. and pays his premiums on time to make sure his dependents will get the insurance money in case of his death. But due to non disclosure of his old or existing policy details at the time of buying insurance from XYZ co, XYZ insurance company denied to pay the insurance money to his family after his death.
So while purchasing any life insurance insurance policy whether it be a term insurance, Whole life insurance, Endowment Plan, Money Back Policy Or ULIP. Make sure that you notify the details of your existing life insurance at the time of applying the new.
What If You Have Not Disclosed Your Old Insurance Policies To Your New Insurance Company?
If in case you bought another insurance policy without disclosing your old policy details to the new insurer, then you can approach your insurance agent or the customer care of the new insurance company to know how you can declare the details of your old life insurance policy.