Placing a claim on a life insurance policy should be a smooth process when you have all the right documents. However, things can easily go south for a couple of reasons, causing your claim to be denied.
Prevent this from happening by being aware of the things that can cause a claim to be denied.
Non-Disclosure
Non-disclosure means that the policyholder has not given their insurer all the important information concerning their occupation, health, possessions, or medical history. Some people even do this unintentionally which can end up costing them. Always remember to check that the information on your policy is correct. Make sure to inform your insurer should anything change, that can affect you when it is time to place a claim.
Not meeting the claim requirements
Your insurer will require documents that you will need to submit based on whether the death was accidental or natural. Not having documents such as a fully completed claim form, a certified copy of the death certificate, completed DHA-1663 form, a certified copy of the beneficiaries I.D’s, 3 months bank statement for all beneficiaries, and police report in case of an unnatural death may lead to your claim not being paid. Carefully read the requirements that are needed for a claim to be processed on your insurers website to help you through the process.
Premiums not being up to date
Something as small as having a missed premium could end up affecting something as important as having your life insurance policy paying out. If the premiums have not been kept up to date or cancelled before the policy holder has passed on, it can cause the insurer to deny the claim.
Claim event arising abroad
Most insurers will cover you for a claim that has occurred outside the borders of South Africa. However, there are a list of countries that insurers will not cover due to the danger they pose to your life. Should the policyholder decide to go to one of these countries, and pass away while there, your insurer could deny the claim.
Committing suicide within the waiting period
Most policies have a waiting period which means a period of time needs to pass on before you are actually covered. When it comes to life insurance, this is usually 24 months. If the policy holder passes on with suicide as a cause of death during this time frame, the claim will not be paid out.
While an insurer will do their best to make sure that your loved ones receive what is due to them, it is equally important that policyholders understand the terms and conditions that come with their policy. Furthermore, taking the time to read the exclusions that can prevent a claim from being approved can help you and your loved ones avoid disappointment.
