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How to make the insurance claim process easier for your nominees?

How to make the insurance claim process easier for your nominees?

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People buy an insurance policy so that their dependents don’t have to suffer financial hardships in the unfortunate event of their demise and are able to maintain the same lifestyle with the claim amount that they get from the insurance company.

Buying the policy is not enough. The persons should ensure that the premiums are paid on time and the disclosures are correct. Otherwise, it will become inconvenient for the dependents to make a claim and they would have to run around a lot. There are certain things that you can do so that the insurance claims can are cleared smoothly.

Always provide correct details-

It is always better to provide all the correct medical details about yourself. When you are no longer there and anything incorrect is found at the time of claim settlement the nominees can be denied the claim. When there is a claim within three years from the date of commencement of policy it is classified as an early death claim and the insurance companies carry out a detailed investigation. And if the insurance company finds out that there is a misrepresentation of facts and there was a non-disclosure the insurance claim may get rejected. So it is always better not to withhold any material information.

Pay the premiums on time-

It is wise to always pay the insurance premiums on time. The policy lapses after 30 days of non-payment of premium i.e. the grace period. If the insured does not pay the premium even during the grace period the insurance policy will lapse; the insured will not enjoy coverage from the policy and will not be eligible for the death benefits. If you wish you can revive the lapsed policy as per the terms and conditions of the insurance company.

Update the policy-

It is always recommended to update the policy with the latest information. If there is a change in your address or the contact details, the details should be updated for your own good. The other instances where you can update the policy are when you get married or divorced. The reasons for carrying out an update are quite important. It increases transparency and there are fewer chances for error and confusion.

Keep the documents in a safe place-

Individuals should always keep important documents like the insurance policy in a safe place and inform the nominee about it so that they don’t have to struggle to find the documents. This will make their life easier and they would have access to the documents when they have to make an insurance claim.

Inform the nominee-

Your nominee should be well aware of the details of the policy so that they would know what to expect in the unfortunate event of your demise. Inform your nominee about the insurance claim settlement process and the documents they would need to submit. In case you have purchased the policy through an advisor they should have the contact details so they can contact them for assistance when required.

There are other things you can do to make life easier for the nominee. You can choose the claim payout options wisely. If you choose the lump sum option the nominee would receive the entire claim in a single payment. If you have taken loans the nominee would receive the amount, settle the loans and keep the balance.  This option can be chosen if you are sure the nominee would be able to manage a large amount of money well.

The other option would be the monthly income payout where the nominee would receive the amount in monthly installments and have a regular income for meeting their expenses. One more option is the combined lump sum and monthly income payout where a certain amount is paid to the nominee in one shot and the remaining is given every month for a certain period.

The first step that a nominee can take is to inform the insurance company as soon as possible and register a claim. They can either visit the nearest office and inform in writing or write a mail or even inform through the toll-free number. They can then complete the documentation process and receive the claim amount. Being well aware and staying informed makes the whole process easier.

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