Avijit, a transport business owner, had bought a life insurance policy in the early 90s. His family had to file a death claim on the policy in 2015 when he met with an unfortunate and fatal accident.
His son, Rajendra was 20 years old then and recalls what a difficult time they had to face. The whole process ultimately took more than a month. The claim amount was nonetheless very useful for the family in sustaining the livelihood and business.
Rajendra also bought a life insurance a few years later, once he started to run the business. While researching for a suitable plan he realised things have changed a lot since his father’s days. Now he could buy the best life insurance policy online.
Not only that, Rajendra now has the option of claim guarantee with online life insurance plans, especially the term insurance. Life insurance plans with claim guarantee promised to settle the death claim within a short period.
As per the time limits set by the Insurance Regulatory and Development Authority (IRDA) of India, insurers should settle death claim within 30 days. This condition applies to all claims where the insurer does not see the need to investigate the cause of death.
The 30-day count starts once the family submits all the relevant documents related to the death claim. In the case of investigation in the claim, this limit extends to 90 days.
If the insurer cannot settle the claim within this time limit, they will pay interest on the claim amount for the delay.
While the regulator has put the conditions for timely claim settlement, claim guarantee ensures a voluntary claim assurance from the insurer. Claim guarantee applies to life policies which meet the criteria set-up by the insurer.
The claim settlement time limit has come down from 30 days to 24 hours due to claim guarantee. While 24 hours is desirable for all the policies, but at times the claim may take additional time. For such cases, the maximum time to settlement goes up to five working days, especially if the claim amount is large.
For example, if the death claim is within Rs. 1 crore, insurers can settle it within 24 hours. Death claims more than Rs. 1 crore may take a little longer, but in any case, would be settled within five working days.
You should note that the clock starts ticking only after the insurer receives all the relevant documents for the claim.
Following documents are necessary for filing a death claim apart from the claim form:
You may need to file additional documents depending on the conditions of the demise of the policyholder.
Claim guarantee is based on strict underwriting principles and technology-enabled data analysis solutions. Insurers have been consistently investing money and effort into technologies which can improve the efficiency of the underwriting processes.
Insurers now use artificial intelligence and big data analytics to collect user data and create accurate individual risk profiles. All this adds up to policyholder’s risk profile, and at the time of claim, can be verified quickly.
These days claim guarantee is a unique feature of online term insurance policies. Canara HSBC OBC Life’s online term plan iSelect Star also offers this benefit to the policyholders.
E-insurance account or Electronic Insurance account is another leap towards total digitization of the insurance process. E-insurance account acts for insurance policies just like a d-mat account works for stocks and mutual fund holdings.
You can add all your life insurance policies to your e-insurance account and use it to manage them all from one place. E-insurance account eliminates the need for all paperwork related to policy management.
You also need to assign an authorised representative for your e-insurance account. The authorised representative will be liable to operate your e-insurance account and close it in the case of your demise.
While authorised representative may access the policy details of the account owner, the policy benefits still go to the nominees only.
Canara HSBC OBC Life is also one of the insurers playing aggressively on tech front as well. You can buy Canara HCBC OBC Life’s iSelect Star term plan completely online. This plan offers 1 Day claim settlement on policies which remain in force for more than three consecutive policy years.
Claiming families may receive the death benefit within a day for eligible policies. Thus, when you are looking for a good life insurance policy do have a look at the time it’ll take to settle the death claim.
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The premium is one of the most important factors to consider before buying a life insurance policy. Many people buy a life insurance policy with a high sum assured but are unable to process the premiums for the entire premium payment tenure. You can get a better idea of the premium outgo with the premium calculator available in the 'Tools and Calculator' section of www.canarahsbclife.com.
Life insurance plans come with several riders which increase the efficiency of the policy for the buyer. For instance, if you have a history of terminal illness in your family it would be advisable to opt for terminal illness rider with your term insurance plan. Riders or add-ons help in customising the standard policy benefits for the requirement of different families. The iSelect term insurance plan comes with a built-in cover for terminal illness, and option for protection against accidental death or disability. You can also opt to cover your spouse's life under the same policy by paying an additional premium.
Life insurance companies calculate the premiums based on several factors such as age, gender and occupation.
Age: It is one of the biggest factors that influence life insurance premiums. Premiums tend to be low when the life insured is younger as the chance of contracting diseases is low. Young people also opt for the best life insurance policies with longer tenures and pay premiums for a longer duration, which makes the policy cheaper for young people.
Gender: The insurance premium for women is generally lower when it comes to life insurance plans. Women live longer and pose a lesser risk of a claim leading to lower premiums for them.
Lifestyle habits: The premiums for people who smoke or drink is always higher due to higher health risks.
Policy term: Policy terms are also taken into consideration by insurers while deciding the premium amount. Life insurance policies with longer tenure are cheaper as compared to short-duration policies.
Mode of purchase: The platform that you use to buy the best life insurance policy also determines how much you will have to pay for the plan. People who buy life insurance policies online have to pay lower premiums as compared to offline policies.
Occupation: The nature of your work is an important factor that influences the premium amount. Certain occupations like shipping and mining are considered more dangerous as compared to jobs in services industries. The insurance premium rises with the risk profile.
Processing life insurance claim is a transparent and smooth process with Canara HSBC Oriental Bank of Commerce Life Insurance.
In case of the death of the life insured, the nominee will have to intimate the company by filling a Death Claim Form and sending it to the nearest branch office.
Once the form is received, the claim is registered by the insurer.
After the registration of the claim, the company will send the claims pack along with the related forms such as physician’s statement form and employer certificate that need to be filled.
Along with the duly filled forms a few documents such as original [policy document, death certificate, copy of bank passbook, hospital or treatment records, photo identification and address proof have to be provided.
The claim is processed on the submission of relevant documents. Once the documents are verified, the claim amount is released post all due diligence.
Household expenses rise with age. The cost of children's education increases along with other lifestyle expenses. The iSelect term plan offers an option to increase the cover according to the life stage. If opted, the insurance cover increases by 25% at every 5-year terminal till the 20th policy year.
Even though a life insurance policy is bought to protect your family in your absence, there are chances of the claim being rejected due to several factors.
False information: If the policyholder provides false information or conceals important information while buying the life insurance policy, the insurer has the right to reject the claim after his/her death.
Type of death: Deaths due to suicide in first policy year, intoxication or pre-existing disease is not covered under life insurance plan.
Premium payment: The payment of premiums on time is of utmost important to avail the benefits of life insurance. Life insurance policy may lapse on the failure to pay the premiums
Nominee details: A life insurance company can put the claim on hold if the nominee details have not been filled or not been updated by the policyholder.
Buying the best life insurance plan online is not only safe but a better option. Online life insurance policies have lower premiums and the individual is not required to visit the insurer's branch or a bank. The best life insurance policies online insurance offer higher benefits. Customers should, however, buy online life insurance policies only from credible insurers and should check for SSL certificate on the website to ensure that the website is legitimate.
The cost of life insurance policies varies depending on factors like age, gender and occupation. The average cost of life insurance plans, especially term plans, is very low compared to the amount of coverage offered.
An individual is allowed to have multiple life insurance policies. People opt for more than one life insurance policy to increase the cover or avoid claim rejection. In case of multiple life insurance policies, even if the claim is rejected by one insurer, the beneficiaries may receive the benefit from a different insurer.
Life insurance policies are of different types. In case of unit-linked or endowment policies the policyholder receives the maturity benefit at the end of the policy term. However, in the case of term insurance plans, there are no maturity benefits. The death benefit is only paid out after the death of the life insured.
When you buy a life insurance policy, the insurance company asks for the nominee details. Only the person named as the nominee in the life insurance plan can cash out in case of death of life insured.
A life insurance policy is generally taken for a specified period. After the policy duration of a term plan gets over, the policy simply terminates and ceases to exist. However, in case of unit-linked plans or endowment, you can use the policy as a tool for retirement planning and the accumulated corpus is used by the insurer to pay you monthly amounts for your entire life.
If a policyholder purchases a term plan for 25 years and dies during the policy term, the beneficiary receives the death benefit. In case of iSelect term plan, the policy provides four payment options to the beneficiaries. If the regular payment option is chosen, the policy works as a source of regular income.
It is a popular misconception that life insurance plans are only for accidental deaths. A term life insurance plan like iSelect Star Term Plan also covers terminal disease along with death. A terminal illness cover is important as health insurance pays only for the cost of treatment and hospitalization, but a terminal illness cover pays you a lump-sum amount which takes care of other expenses. On the other hand, unit-linked policies such as Invest 4G cover death and also provide decent returns for other financial goals such as buying a house of child's education.
It is ideal to buy a life insurance plan in your early 20s because it is the time when people have just started with their professional life and so there are lesser responsibilities and financial liabilities to take care of. Also, if you buy the best life insurance plan at this age, you will be paying relatively lower insurance premiums since it’s a due fact that mortality rate in case of young people is low. And that is why life insurance companies offer lesser premium rates to younger people as they think that they are most likely to be fit and healthier with less chances of filing a claim in future.
Once you have cancelled your life insurance policy, you will instantly lose your life insurance cover. Afterwards, your insurance company will get in touch with you and ask for valid reasons regarding the cancellation of your policy. In case you cancel your life insurance policy within the grace period, i.e. 15 to 30 days, depending on your insurer, then insurance company will reimburse the premium amount paid by you. But, no refunds will be paid to you if the policy is cancelled after the grace period.
Yes, you can take life insurance under Married Women’s Property (MWP) Act, 1984 only if you are a married man and a resident of India. Buying a life insurance plan under MWP Act would be helpful in saving your family’s financial well-being when you are not around. As per this policy, only wife and children would be eligible to receive the death benefits. You can also buy a policy if you are a widower or a divorcee. However, in that case, you can give your child’s name as your beneficiary. It is very simple to buy a life plan under MWP Act. All you need to do is to fill up an MWP addendum while purchasing an insurance policy.
Yes, there are different payment options for you to pay premiums. Here’re some of them
1. Regular premium payment option – This premium payment option allows you to pay premiums equal to your policy term either monthly, quarterly, half yearly or annually.
2. Single payment option – Through this premium payment option, you can pay the lump-sum amount in one single payment.
3. Limited payment option -In this premium payment option, you can pay premiums for a specific period of time less than policy term either monthly, quarterly, half yearly or annually, but benefits of insurance can be enjoyed for a longer period of time.
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