I read that one important aspect while choosing a term plan is its claim settlement ratio. It is high only for few companies like LIC, SBI, ICICI and HDFC.But their premium is also high. I want a sum assured of Rs 1.5 crores and plan to split it in two companies. For Rs 75 lakh, LIC has a premium of Rs 26,000. I cannot afford to pay such high for Rs 75 lakh; at the same time I am concerned about difficulties in claiming it.
If your pocket does not allow you to shell out the premium for LIC, you need not worry. Online policies are cheaper as compared to offline plans due to elimination of intermediaries. Make sure you select a policy term equal to years remaining to your retirement or till someone else in the family starts earning.
There are private insurers who offer similar cover at much lower rates. ICICI Pru iCare, HDFC Click2Protect, Bharti AXA Life eProtect are some of the good plans that can be bought online.
Claim settlement ratio of insurance company is a major factor in deciding which policy to buy. As far as claim rejection is concerned, insurance companies do so under certain circumstances. First, if the reason of claim falls under the Exclusion List of the policy. So before buying any insurance policy you must go through the policy brochure and insurers website to understand the details, scope of coverage and exclusions specific to the policy.
Second, if you hide or provide inaccurate information about your age, height, weight, lifestyle, consumption habits and medical history. Insurance companies do extensive research before settling any claim. Your claim will be rejected if any misrepresentation is discovered later. Before accepting a proposal for insurance, most insurers require you to go through medical tests if you have completed a certain age. It is a general tendency to avoid Pre-Policy Medical Check Ups. It gives insurers an opportunity to refuse your claim.
To avoid any trouble in future you must provide complete and accurate details while filling the Proposal form.
If an insurance company rejects claim on baseless grounds, the nominee may approach IRDA's Integrated Grievance Management System (IGMS) wherein policyholder or victim can file an online complaint through IRDA's website for redressal.