How To Claim Insurance Of A Deceased Person?

When a person passes away, their life insurance policy can provide crucial financial support to their family or beneficiaries. However, claiming the insurance payout requires following a clear process, submitting the right documents, and fulfilling the conditions outlined in the insurance policy. The claim process can be complex, but understanding the steps and required documentation will ensure a smooth settlement of the claim.

Steps to Claim Insurance of a Deceased Person:

Obtain the Death Certificate:

The first step in filing an insurance claim for a deceased person is to obtain an official death certificate. This is the primary document needed to prove the death of the policyholder. It should be issued by the government or the concerned authority.

Notify the Insurance Company:

The beneficiaries or the legal heir should promptly inform the insurance company about the policyholder's death. This can typically be done by calling the insurer’s customer service, visiting the branch, or notifying them through the official website (in case of online claims). Most insurance companies will have a specific time period within which the death claim must be filed, so early notification is crucial.

Identify the Beneficiaries and Policy Documents:

If the deceased has nominated beneficiaries in the insurance policy, the process will be more straightforward. The beneficiaries will be required to provide the following documents:

• Original insurance policy document
• Death certificate
• Proof of the relationship to the deceased (such as marriage certificate, birth certificate, or legal heir certificate)
• A copy of the nomination (if applicable)

Complete the Claim Form:

The insurance company will provide a claim form that must be filled out by the beneficiaries or legal heirs. This form usually includes basic details such as the name of the policyholder, the beneficiary’s details, the cause of death (if required), and any other relevant information. The claim form should be signed and submitted along with the required documents.

Provide Supporting Documents:

In addition to the death certificate and claim form, the insurance company may ask for additional documents such as:

• Policyholder’s medical records (if the death was due to illness)
• FIR or police report (if the death was accidental or under suspicious circumstances)
• Bank details of the beneficiaries for payment processing
• Proof of identity (e.g., Aadhar card, passport, or voter ID)

Submit the Documents to the Insurance Company:

All the required documents, including the claim form, death certificate, policy documents, and supporting records, should be submitted to the insurance company. Some companies may allow online submission, while others may require the claimant to visit a branch office.

Insurance Company’s Investigation:

After receiving the claim, the insurance company may initiate an investigation to verify the details of the claim. This may include:

• Verifying the authenticity of the death certificate
• Investigating the cause of death (especially in cases of accidental death)
• Reviewing the policyholder’s medical history (if the death was due to illness)

Claim Settlement:

Once the insurance company completes its investigation and validates the claim, they will process the payout. If all documents are in order and there are no discrepancies, the claim will be approved, and the payout will be disbursed to the beneficiaries. The payout can either be a lump sum amount or as a regular annuity, depending on the type of policy.

Dispute Resolution:

If the claim is rejected or delayed, the beneficiaries can approach the insurance ombudsman or file a complaint with the consumer forum. Insurance disputes can arise due to policy exclusions, misrepresentation, or delay in processing, but they can often be resolved legally.

Key Factors to Consider:

Exclusions in the Policy:

Be sure to check the policy’s terms and conditions, as some causes of death may be excluded from the insurance payout. For example, suicide within the first year of the policy or death due to illegal activities may not be covered.

Nominee vs. Legal Heir:

If the nominee is not available or the nominee is different from the legal heir, the insurance company will distribute the funds according to the legal heir’s certificate or the law of succession.

Term Life vs. Endowment Plans:

The claim process may differ slightly for term life insurance policies (which pay out a lump sum) and endowment plans (which pay out a sum upon maturity or on death). Endowment plans may have surrender values, bonuses, or additional rider benefits.

Contestable Claims:

If the policyholder’s death occurs within the contestability period (usually 2 years from policy issuance), the insurance company may investigate the claim more thoroughly. This is a period during which the insurance company can investigate the death more rigorously to ensure there was no fraud or misrepresentation during the policy application.

Example:

Let’s say Mr. A passed away in an accident, and he had a life insurance policy with a nominee, his wife, Mrs. A.

Mrs. A obtains the death certificate from the hospital and immediately notifies the insurance company.

She fills out the claim form, attaches a copy of the accident report from the police, the original policy document, and her marriage certificate as proof of her relationship to Mr. A.

The insurance company reviews the documents, and after conducting an investigation to confirm the cause of death (accidental death), the claim is approved.

The insurance payout is transferred to Mrs. A’s bank account as per the terms of the policy.