Wondering what could result in a denied life insurance claim? Here’s what you should know to avoid it.
Life insurance is a great tool to help ensure the financial security of your family. Still, there’s no point in paying premiums for years only to have a claim denied – especially due to a reason that could’ve been easily avoided. To ensure this doesn’t happen to your beneficiaries, read on to learn more about why life insurance claims are denied so you can ensure it doesn’t happen to your loved ones.
Common reasons for life insurance claim denials
Non-disclosure
As it turns out, non-disclosure is the leading cause of claim rejection. This occurs when policyholders fail to share important information with their insurer regarding things that affect their policy’s underwriting. To explain, insurers will use the information you give them to calculate your premium based on your risk factor. This is why they’ll ask questions regarding your occupation, health or medical history. As an example, if you lie on your application to make it look like you don’t have a dangerous job or are in better health than you really are – and this lie comes to light when it’s time to claim – it’s likely to be denied. In short, honesty is the best policy, especially when it comes to life insurance policies. Also, if anything changes, be sure to keep your insurer up to date.
Failure to meet claim requirements
At MiWayLife, we aim to keep life insurance simple. Still, incomplete documentation, such as an unsubmitted claim form, absence of a certified copy of the death certificate, or failure to provide necessary identification and financial documents, can lead to claim denial.
Unpaid premiums
Lapsed premium payments before the policyholder's passing can result in claim denial. If you’re worried about missing a payment, here’s what you need to know to prevent your cover from being cancelled.
Suicide within the waiting period
It’s a myth that life insurance won’t ever pay out if the policyholder commits suicide. However, many life insurers, including MiWayLife, impose a waiting period, typically 24 months, during which suicide is not covered and will lead to a claim rejection. You can learn more about it over here.
Engaging in excluded activities
Life insurance policies often contain a list of exclusions – provisions referring to perils, hazards, circumstances and activities not covered by the policy. MiWayLife is no exception and our list of exclusions includes claims events that arise from travelling to dangerous countries such as Afghanistan and Iraq; partaking in risky activities such as solo mountaineering and behaviours like taking illegal drugs and driving under the influence. You’ll find the full list of exclusions in the terms and conditions of your policy. Getting to know what they are and acting accordingly can be all the difference between a paid and unpaid claim.
Did You Know:
You can now take out life cover with us online in a few simple steps. No calls and no agents! Make sure to take care of those you love today by buying MiWayLife cover online.
